Is irs form 8996 supported for the 2018 tax year?

[TomK · Accepted solution]

No, Form 8996 - Qualified Opportunity Fund is NOT supported by TurboTax Online nor TurboTax CD/Download for tax year 2018.

[jturner2ttax]

How do I exclude capital gains in 2018 that are deferred in the form 8996?

[Aspirin756]

Form 8996 is for certifying a QOF and is filed by the QOF entity.  For excluding capital gains that have been invested in a QOF, we enter a new code ("Z") on the new version of Form 8949. See the IRS instructions for Form 8949. Turbo Tax does not appear to provide any support for this, so I think we have to use overrides and update the form manually.

[alway34]

With regards to TurboTaxTomK's answer... is that a "it will NOT be supported" or simply "it is NOT supported yet"?  Any chance form 8996 will be included in the software by April 15th?

[jpabello]

If this is really true - that TurboTax 2018 will not support QOF - that would be extremely disappointing of Intuit.  Please at least provide the option to manually update the form with code Z in form 8949 as instructed by the IRS!

[Aspirin756]

@jpabello , the code Z will go on the investor's Form 8949 "Sales and Other Dispositions of Capital Assets", not the Form 8996 which is filed by the QOF.  I haven't checked yet whether the TT interview for capital gains prompts for QOF, but at worst I think it should be a simple override in forms mode.

[jpabello]

I have tried to manually enter code Z in form 8949 in TurboTax 2018, and it is not working. The override is not allowed, at least not yet. I hope Intuit will release a fix to this quickly.

[alway34]

It would be nice if someone from Intuit/TT would comment on how to handle this situation.  I would prefer not waiting any longer to get a CPA to do my taxes if they cannot support this.

[Aspirin756]

That's really annoying if we can't override the code!  I found an answer that explains how to manually file just the Form 8949. See <a rel="nofollow" target="_blank" href="https://ttlc.intuit.com/questions/4351423-how-can-i-use-a-prepared-form-8949-instead-of-entering-a-1... PDF form is available from the IRS so it's easy to fill out on our own if that's what we have to do, but I wasn't sure how to attach that to the TT filing.  Sounds like this method would work. I've not tried it myself though.

[alway34]

If Turbotax can't address whether form 8996 will be in the software in the next month or have a viable work around I need to know so I can find someone to do my taxes.  Does anyone have any information on this?

[Aspirin756]

Update: It is NOW possible to override the codes in Form 8949. There is a good description of how to do so for an Opportunity Zone investment, posted by @hpadden here:
<a rel="nofollow" target="_blank" href="https://ttlc.intuit.com/questions/4502160-oppertunity-zone-capital-gains-credit-does-tt-allow-me-to-...>

My original reply (for context):
Yes, it would be good to have more clarity from TT, it's an annoying omission. Come on TT.
I feel strongly that the lack of "Code Z" support in Form 8949 is the biggest problem. While it's rather easy to fill out 8996 ourselves if we're doing taxes for a QOF, the lack of Code Z support in 8949 affects all investors in a QOF and ripples through all the capital gains calculations.
There is at least one separate open question on this: <a rel="nofollow" target="_blank" href="https://ttlc.intuit.com/questions/4649558-when-will-tt-support-opportunity-zone-capital-gains-deferr...>

[jturner2ttax]

TT is really failing on the QOZ tax law. IRS Form 8949 instructions clearly states on page 10 to enter Z code and how columns (a) to (g) are to be completed. TT does not have this capability. When in override the boxes can be completed as called by IRS instructions, however, TT does not calculate the deferral of taxable gains under the new QOZ law 1400Z. Instead TT calculates AMT on the gain rather than deferring the capital gain. Big problem that TT needs to fix for 2018 returns. Can we have a schedule when the fix will be released??

[jpabello]

I had the same problem with TT's AMT calculation and was able to work around it by also manually overriding Schedule D AMT. Definitely not optimal and I would very much appreciate an actual TurboTax fix instead.

[anrdiaz]

That is what I did. I manually filed Form 8949 ie sent in with Form 8453 that you can print from turbotax. Definitely a hassle. 

Does anyone know how to file 8996 to certify the OZ fund? Turbotax asks you if you want to send and then there is no explanation of how to send it.