Federal return rejection Reject Code F8960-019-04 Processing error Form 8960, Net Investment Income Tax. We do not have an estimate for when the problem will be resolved

[BligBlueLaser]

@pdlink300 

I’m only 89.60% sure this is exclusively an IRS issue, based mostly on two things:

• TT seems to be doing exactly what the IRS specifies in its updated Form 8960 instructions
• The IRS “Known Issues” list seems to describe erroneous rejections that are exactly like we have, and indicates a fix is required

That being said, it’s just software at both ends so who can know the problem is 100% with the IRS?

I suppose we could know if anyone from TT were to add a substantive comment. Once again, tagging in the TT experts from the sidebar:

@LindaS5247 

@JosephS1 

@MichaelG81 

@SantinoD 

@RalphH1 

[bsdawkins34]

I am curious is this same error code will come up with H&R block?

[pkillur]

Where are you seeing it updated?  I followed the link you have to the IRS website and it still says "2/5/2023".  There is no 'march' on the spreadsheet, and the only 'february' on the spreadsheet is for 1040.

[pdlink300]

@BligBlueLaser

"I’m only 89.60% sure this is exclusively an IRS issue...." 

😆

[BligBlueLaser]

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@pkillur wrote:

Where are you seeing it updated?  I followed the link you have to the IRS website and it still says "2/5/2023".  There is no 'march' on the spreadsheet, and the only 'february' on the spreadsheet is for 1040.

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Not sure why you're not seeing the latest version of the 2022 spreadsheet but it most definitely says, "Business Rules will be updated sometime in late February to mid-March 2023" at cell F74

[carter76]

I just read up on the instructions /rules for Form 8960 on IRS.gov.  From what I can tell, TT is generating my form correctly based on the instructions shown on IRS.gov.  

It seems the IRS is rejecting the TT returns because TT is using the correctly updated rules, but the IRS hasn't caught its own systems up to reflect the new rules (thus the IRS' own wording in the known issues spreadsheet stating the returns are "erroneously" rejecting).

My thought is that those who are re-filing with H&R Block are having their returns accepted because H&R Block is using the old (read: incorrect) rules.  

Therefore, I believe those who have filed with H&R Block and do need form 8960 under the new rules, might have some issues in the near future - meaning they may need to amend their returns later.

My advice to anyone who truly does need Form 8960 is to wait for the IRS update and refile with TT.  Note that if your MAGI (which is likely equal to your AGI) meets the threshold, you need Form 8960 whether or not you have investment income.  Those thresholds, per the IRS.gov instructions for this form are $250,000 for Married filing jointly or widower, $125,000 for married filing separately and $200,000 for single or head of household.  

While I find it wildly frustrating that TurboTax isn't commenting, I do think its systems are correct vs. H&R Block which seems to be using the old rules.  

Note - I'm not a CPA and the above advice is just my opinion!  

[BligBlueLaser]

@carter76 

You bet it’s “wildly frustrating” that TT doesn’t jump in here with a definitive answer on the issue, especially when this page has a sidebar encouraging us to “Meet Your Experts” (not sure what they do).

In the meantime, I may never get tired of tagging the experts in that list:

@JosephS1 

@LindaS5247 

@MichaelG81 

@SantinoD 

@RalphH1 

[Taxes2023_22]

Hi all -

I just did my taxes in H&R block and can confirm it works and was accepted by IRS in 10 minutes.

I am not dealing with TurboTax for a refund as they won't do it for online product, which is a joke.

Good luck everyone as TurboTax really let us down.

[yarbsea]

Everyone who is re-filing with another company is making a HUGE mistake. Those other companies are doing it wrong. There are a couple back end accountant system for tax returns and those are listing the same problem as we have here at turbo tax. That's GOOD, because that's what's supposed to happen. It's got nothing to do with turbotax - it's the IRS that apparently didn't know people file their taxes EVERY year.

This is an IRS problem. If you file with HRB and they accept it with the incorrect form fill then you will get hit later perhaps with a notice or perhaps have to amend the return or worse an audit for FAILING to file the required 8960. YOU CAN NOT E-FILE the 8960 right now, and just because HRB sends the form in wrong doesn't mean it's 'working' any more than you 'forgetting' to input a W-2 means you don't owe back taxes.

The 8960 has to be filled out when you hit a certain threshold of income. For example 250k married. I have some 1099-DIV that trigger the form.

Anyway - this is my opinion/rant and not tax advice.

[Taxes2023_22]

Also, so you all know - I spoke with someone at TurboTax and they're well aware of the issue and they granted me a refund right away.   Best of luck on whatever decision you take, but the rep was understanding an refund me right away.   

[MikeEII]

If TurboTax is aware of the issue AND it is an IRS issue, why are they allowing these returns to be e-filed and then rejected?  It makes no sense whatsoever.

[marytony]

No matter how you file, if it's earlier than the fix, you may be making it even worse on yourself. Just because you get to efile and it's accepted does not mean you won't have to file an amended form after the IRS update to this error. It doesn't make sense the IRS would allow allow some tax preparing software to go ahead and accept the return but other software's have been rejected. Think about that for a moment.

This particular problem starts with the IRS and they openly admit they have this problem and give an estimated fix date.

People that left tt and did e-file successfully, on H&RB & on eTax, will have a new problem later on simply because that software package allowed the return to be processed without the IRS update. UNLESS, for the few that didn't need the 8960 form, of course. If you don't need that form on your taxes, happily go elsewhere to file.

If you actually do need that form to be a part of their taxes, you may have a worse delay later than you would now, just waiting for the IRS to update the problem. I mean who really WANTS to have to file an amended return or even worse, who WANTS to have to hire an outside service to help straighten out what you've done by filing with a software program that didn't stop your return when it should have been stopped ???  

I am one of those that's desperate for my refund and I think it's going to be best to wait. Unfortunately. But really, why file a form that's wrong and will be eventually stopped just to have the satisfaction of receiving "ACCEPTED", when it most likely can only be a temporary relief.

[marytony]

I totally agree Carter76 !!!!! AND Yarbsea !!!

[pmb33]

When is TurboTax going to address this issae?  After paying for the last 20 years for TurboTax I would think they would address this.

[pmb33]

I saw the spreadsheet too--major mess up