Issue with 2018 State and Local Income Tax Refund Worksheet

[beuan88]

I was about to file my taxes for 2018, when I noticed a bug in 2018 State and Local Income Tax Refund Worksheet which results in incorrectly filled federal and state return forms for me. 2018 worksheet automatically fills the Part III, line 7(c) 2017 Standard Deduction (for Single) as $6300, where 2017 Standard Deduction (for Single) was $6350. Because my deductions drop under $6300 after the refund, part of my state refunds is taxable. The worksheet results in incorrect higher value of total taxable refunds on 2018 Form 1040, line 10. The difference is $50. Consequently, my 2018 federal tax return is lower and state return higher as they supposed to be. I believe this effects only those whose refunds are taxable. I already talked with Customer Care representative, but I want also post the issue on this forum in case the problem is not resolved or gets buried. It would be great, if TurboTax could resolve this issue before more customers file incorrectly filled forms. 

[neilOAK]

I've encountered another issue with the 2018 State and Local Income Tax Refund Worksheet. It does not seem to import the state tax overpayment for 2017 from my 2017 tax return. In previous years the overpayment was populated automatically.

Has anyone else encountered this issue? Is it a bug or is there something in the new tax that requires manually entry?

[truthseeker07]

beuan88 - thanks for sharing. I also discovered this bug.  What I found was the State and Local Income Tax Refund worksheet, Part I, which pulls  the previous years State (b) Tax Refund and (e) Total Payment and Withholding amount,  is actually doubling the amount.  Yes, doubling!. For example, if my 2017 State refund was $500 and my total payment and withholding was $2000, the 2018 State and Local Income Tax Refund worksheet is reporting those amounts as $1000 and $4000 respectively.  Since I live in a state where there is a state income tax,  my refund causes my federal return to increase my federal refund or lower my federal tax due. Therefore, this is considered taxable income. So, now Turbo tax appears to increase my federal taxable income which negatively impacts the tax refund or positively impacts the tax due amount. I have an incident open with Turbo Tax and I am hopeful that will have a update available before 2018 taxes are due on 4/15/2019.   

[GabiU · Accepted solution]

Thank you all for reaching out. 

If you're still having this issue, I'm going to need your help to get more information. Please send me a diagnostic file which is a copy of your tax return that has all of your personal information removed. You can send one to us by following the directions below:

1. Click into your return.
2. Click Online and select "Send Tax File to Agent".
3. This will generate a message that a diagnostic copy will be created. Click on OK, the tax file gets sanitized and transmitted to us.
4. Please provide the Token Number that was generated onto a response to this thread.

[beuan88]

GabiU, thank you for getting back to me! I really appreciate it. After being on the phone with several TuroTax Customer Care representatives in the past two week, it seems yesterday or today someone finally resolve the issue for me. Whoever it was, I am thanking them for their help and assistance.

[fbojorge1952]

t a copy of my income tax return of 2018

[DoninGA]

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@fbojorge1952 wrote:

t a copy of my income tax return of 2018

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To access your current or prior year online tax returns sign onto the TurboTax website with the userID you used to create the account - https://myturbotax.intuit.com/

Scroll down to the bottom of the screen and on the section Your tax returns & documents click on Show.  Click on the Year and Click on Download/print return (PDF)

Or -

When you sign onto your online account and land on the Tax Home web page, scroll down and click on Add a state. 

This will take you back to the 2018 online tax return.

Click on Tax Tools on the left side of the online program screen.  Then click on Print Center.  Then click on Print, save or preview this year's return.  Choose the option Include government and TurboTax worksheets

[spencew]

I am encountering the same bug with TurboTax Premier 2020.  A couple times while filling out my taxes I noticed that it was doubling the amount of my state tax refund.  It only showed one state on the list of state refunds, but it seemed to have two duplicate records in memory, because when I went in to edit the state record, it showed the correct amount, but when I changed it to $2, and exited, it showed the sum of the correct value + $2.  So I deleted the whole record and re-entered it and it showed the correct amount on the summary page.  However, I did log out and back in a couple times, and after I submitted my taxes, I noticed that the amounts (of both the State Tax Refund and State Tax Withheld) were doubled again on the "State and Local Income Tax Refund Worksheet."

[MaryM428]

This is a known issue and in your case if also being compounded by a browser issue where it is overwriting with old data..

Use the Chrome browser and clear browsing data for all time.

Use the Chrome browser
Click the three dots in the upper right corner
Select Settings

Privacy and Security

Clear browser data for all time

Then sign in to TurboTax on the Chrome browser
 

1. Go to Federal
2. Wages and Income
3. Other Common Income
4. Refunds Received for State/Local Tax Returns
5. Revisit
6. Delete the entry there
7. Enter your state refund again.
   
    

If all three of the following are true, your refund counts as taxable income:

1. You itemized deductions last year, instead of taking the standard deduction
2. You claimed state and local income taxes (not general sales taxes)
3. Claiming the deduction helped you increase your federal refund or lower your tax bill