New York State Casualty Loss Update

[Lqqk23]

Turbo Tax is not allowing me to file because I claimed a casualty loss on my Fed return and New York State

is coming up with an error when I do the review.

It says that "Due to Federal Legislation that recently passed, The allowable casualty loss for major disasters has on Form 4684 has changed. We are working diligently on updating the impact on your state and will have the updates available as soon as possible."

When do you think these updates will be available of New York State. It is now March 16. I saw in other

comments it may be available at this time. It is not.

Thank you.

[LindaS5247]

Yes, you are likely getting that error because that form is not yet available in TurboTax.  You can check forms availability here.

You should make sure that all updates have been run for your TurboTax program. ‌Click here for information on manually updating TurboTax.

It takes some time to incorporate IRS forms into TurboTax. They may be available from the IRS on a certain date, but TurboTax needs time to make the forms available for use in TurboTax.

The Form for reporting a casualty loss on your New York state tax return is Form IT-196. ‌You will report your casualty loss on line 20. You must itemize your deductions to report a casualty loss on your New York State Tax Return. ‌

You can itemize your deductions for New York State even if you claim the Standard Deduction on your federal  tax return.

Click here for "Itemized deductions (2024) New York State"

Click here for "When will my individual tax forms be available in TurboTax?"

If you have additional information or questions regarding this, please return to Community and we would be glad to help.

[Kp3649]

The form for New York State is actually available (IT-196), so now both the federal and state form for New York State are available this error is still coming up and causing an issue for all of us.

This is honestly ridiculous that TurboTax has not resolved this issue yet and we are all waiting for a solution. 
Is anybody at TurboTax even looking into this? It has been over two weeks now and there has not been a change, please advise any TurboTax moderators.

[BrittanyS]

Can you clarify if you are using TurboTax Desktop or TurboTax Online?  If using TurboTax Desktop, have you ran the most recent update?  

@Kp3649 

[Kp3649]

@BrittanyS  I am using TurboTax online, however now the problem is that the casualty and loss deduction will not carry over to my IT-196 (line 37 I believe). I had been on multiple session with the solutions team and they are unable to manually add it in as you can on the desktop. 
Also I am unable to file with the desktop, not because it doesn’t work (because I tried and it seems to be alright) but because I already efiled my federal with TurboTax online. 

Is there a solution being worked on for TurboTax online?

I have been waiting to efile my state for over 3 weeks and it is only TurboTax online that is the issue, and it’s purely a technical issue at this point. 

[BrittanyS]

I would like to take a deeper look at this. However, I need 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:

TurboTax Online:

1. Sign into your online account.
2. Locate the Tax Tools on the left-hand side of the screen.
3. A drop-down will appear. Select Tools
4. On the pop-up screen, click on “Share my file with agent.”
5. This will generate a message that a diagnostic file gets sanitized and transmitted to us.
6. Please provide the Token Number that was generated in the response.

TurboTax Desktop/Download Versions:

1. Open your return.
2. Click the Online tab in the black bar across the top of TurboTax and select “Send Tax File to Agent” *
3. This will generate a message that a diagnostic copy will be created.  Click on OK and the tax file will be sanitized and transmitted to us.
4. Please provide the Token Number (including the dash) that was generated in the response.

*(If using a MAC, go to the menu at the top of the screen, select Help, then, “Send Tax File to Agent”)

[Kp3649]

@BrittanyS Sure that would be great if you want to look into this. Just so you know multiple other individuals from the solutions team and IT have looked into this with no clear solution or even true understanding of the issue (although it seems like a straightforward issue). If we could just manually enter the appropriate deductions on the IT-196 on the online program there would be no problem, just like you can with the desktop version.

Anyway here is my token # 1292796.

Please let me know if there is anything you can do to fix this issue or get some sort of recognition that there is a true issue from Turbotax because I am beyond frustrated with this company at this point now that I have spent literally probably 10 hours collectively on the phone with multiple individuals. 

[BrittanyS]

Here is what I have been able to find out.  I've reviewed the file and confirmed the federal disaster is not carrying over to the NY return.  I was notified that TurboTax has been communicating with New York regarding whether they are going to conform to the federal guidelines.  There is a superpatch update that is coming Friday that should address this issue with multiple states.  Follow back up on Friday for the update.  We should have additional information then.

@Kp3649 

[Kp3649]

@BrittanyS  thank you for looking into and getting some further clarification. This is very helpful that there may actually be an ETA of a fix. I will follow up on Friday and see and then reply to this thread either way. I am hopeful there will finally be a resolution to this.
Thank you! 

[Kp3649]

@BrittanyS 

So I checked on my turbotax online and nothing has changed in terms of this issue and it still remains unsolved. Was there an update completed and is turbotax essentially not going to fix this issue and require me to mail my tax return?

[LeticiaF1]

The IRS updated the system this week to start accepting e-filed tax returns with Form 5695 Joint Occupancy. However, a processing problem still exists. To ensure the accuracy of tax returns, TurboTax is working hard to eliminate the issue. The expected resolution date is April 4, 2025. On or after that date, please log back into your TurboTax account, fix any error messages and e-file your tax return. 

There is also an option to print and mail your return. If the special rule for joint occupants applies to you, please make sure that the box on line 32a of Form 5695 is checked. Then attach a statement to your printed return that explains how the special rule applies to your situation. 

This statement should include:

• The names and Social Security numbers of all joint occupants.
• A description of the property and the nature of the improvements made.
• An explanation of how the costs were shared among the joint occupants.

TurboTax does not automatically generate this statement, so you will need to create it yourself. Make sure to include this statement when you mail your tax return to the IRS. 

Here is a possible template that you can use:

Statement for Special Rule for Joint Occupants

Taxpayer Name: [Your Full Name]

Taxpayer Identification Number: [Your SSN or ITIN]

Tax Year: [Year]

Names and Social Security Numbers of Joint Occupants:

[Full Name of Joint Occupant 1], [SSN of Joint Occupant 1]

[Full Name of Joint Occupant 2], [SSN of Joint Occupant 2]

(Include additional names and SSNs if applicable.)

Description of Property and Improvements:

The property is located at [Property Address]. During the tax year, the following energy-efficient improvements were made to the property:

[Description of Improvement 1] (e.g., installation of solar panels, energy-efficient windows, etc.)

[Description of Improvement 2] (if applicable).

Explanation of Cost Sharing:

The total cost of the qualified energy-efficient improvements was $[Total Cost]. The costs were shared among the joint occupants as follows:

[Your Full Name]: $[Amount Paid by You]

[Joint Occupant 1's Full Name]: $[Amount Paid by Joint Occupant 1]

[Joint Occupant 2's Full Name]: $[Amount Paid by Joint Occupant 2]

Based on these contributions, I am claiming my allocable share of the energy-efficient home improvement credit. My share was calculated as follows:

Credit Allocable to Me = (Credit Limit for Property) × (Amount Paid by Me / Total Amount Paid by All Occupants)

@Kp3649