Interest paid by the IRS is not supported by TurboTax

[lykhin]

Hello,

I have an interest of $14 paid by IRS because of the backlog in 2021. The free TurboTax version supports interest up to $1500 but it doesn't let me file taxes for free saying that my case is not supported because of interest and forcing me to upgrade to the Deluxe version. Why is that?

Alex

[VolvoGirl]

Why is it making you upgrade?   You must be entering it in the wrong place.  It is just regular interest like bank interest.

Enter interest from the IRS like a 1099Int and put the amount in box 1.

Enter a 1099-Int  under

Federal on left

Wages & Income at top

Interest and Dividends

Interest on 1099INT - Click the Start or Revisit button

Don't enter a bank or broker name and don't try to import it.  At the bottom pick -  Change How I enter my Form

Then on the next screen pick I'll Type it in Myself

Put the interest amount in box 1

[DoninGA]

You must have entered something else that requires you to upgrade.  You can enter interest income in the Free edition as long as the amount is under $1,500 without upgrading to Deluxe.  If the interest amount received is $1,500 or more then a Schedule B is require which is not supported by the Free edition.

Clear your return and start over.

If you have not paid for the online edition you are using, have not filed your tax return or registered the Free edition, then you can clear your return and start over with a lower priced edition. Click on Tax Tools on the left side of the program screen while working on the 2021 online tax return. Click on Clear & Start Over.

[lykhin]

The 1099-INT doesn't seem to work in the free version.  

My case is simple: W2, standard deduction, joint return, interest from IRS only.

Here is what I did:

1. Review Interest on 1099-INT

2. Did you receive any interest income? -> Yes

3. Change how I enter my form

4. Type it myself

5. Federal Identification Number (FEIN) -> 38-1798424

6. Received from -> IRS

7. This 1099-INT belongs to -> Both of us

8. Box 1. Interest income -> 14.11

9. Do any of these uncommon situations apply? -> None of these apply.

10. Finish  (Done)

I get the following message: Based on your tax situation, you need to upgrade to TurboTax Deluxe. Free Edition is only for simple tax returns You won’t be able to report interest and dividend income over $1,500.

[lykhin]

If I remove 1099-INT, I can file a Federal tax return. I have only one interest paid by IRS. The problem is still with 1099-INT. 

[lykhin]

Alright, I have figured out what was the problem. I cleared my return and started from scratch and I was able to successfully add the 1099-INT form. However, it turned out the Free version of Turbotax does not support foreign accounts. That was the reason why I couldn't file a return in the first place and not the incorrect message that I had an interest greater than $1500, whereas the actual interest was only $14. You should take action and make it clear for your Free product because eventually I bought a Deluxe version but spent several hours trying to figure out what's going on.