Glitch in Form 7206

[TC1079]

I completed the preparation of my taxes and Turbotax generated a $6,000 deduction on line 17 of Schedule 1 for self-employed health insurance. That deduction amount appears to be correct. However, on form 7206, the amount of health insurance premiums on line 1 is blank and the amount of the deduction listed on line 14 of the form is 0.  The line 14 instructions on Form 7206 specifically state that the amount listed there should also be listed on line 17 of schedule 1. So, there is a conflict between the amount on line 14 of Form 7206 and the amount on line 17 of schedule 1. Since the Turbotax program generates these numbers, it appears to me that there is a glitch in the program that requires correction, so that a possible audit is not triggered. Please advise.

I would also note that you can only see form 7206 as submitted to the IRS when going to the preview in the "Print center" section of the program. When I open up form 7206 under schedule C in "forms in my return" it gives me a worksheet version of this form, including a note added at the bottom that there is a $6,000 adjustment for premiums paid through an exchange that does not appear on the worksheet. However, even that explanatory note is not included on the 7206 form filed with the IRS. 

[AnnetteB6]

To take a closer look at this situation if would be helpful to have a diagnostic copy of your tax file experiencing the issue.  

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[TC1079]

The cd program is turbotax deluxe for 2023. The token is 1188570. I actually created a new comparable fictional tax return which I sent you. It produced the same problem. Form 7206 as shown in the print version of the program shows the self employed health insurance deduction to be zero, but the actual deduction of $7,548 appears on line 17 of schedule 1. Thank you.

[TC1079]

I am filing in the state of California. I will await your response.

[DawnC]

According to the instructions for Line 17 of Schedule 1, Form 7206 is not used to figure your deduction and is not required to be filed.  

Use Form 7206 instead of the Self-Employed Health Insurance Deduction Worksheet in these instructions to figure your deduction if any of the following applies.

• You had more than one source of income subject to self-employment tax.
• You file Form 2555.
• You are using amounts paid for qualified long-term care insurance to figure the deduction.

Use Pub. 974 instead of the worksheet in these instructions if the insurance plan was considered to be established under your business and was obtained through the Marketplace, and advance payments of the premium tax credit were made, or you are claiming the premium tax credit.  (you had both)

This part provides special instructions for figuring the self-employed health insurance deduction and PTC if you or your spouse was self-employed, you or a member of your tax family was enrolled in a qualified health plan in 2022, and you may be eligible for the PTC. Because the amount of the self-employed health insurance deduction may affect the amount of the PTC, and the amount of the PTC may affect the amount of the deduction, a taxpayer who may be eligible for both may have difficulty determining the amounts of those items. A taxpayer who may be eligible for both may follow the instructions in this part to determine amounts of the self-employed health insurance deduction and PTC that are allowable under the law.

[TC1079]

I'm sorry it was not reflected in the draft return I sent you, but I do have more than 1 source of income subject to the self employment tax. Therefore, the instructions you have provided indicate to me that Form 7206 is required. Moreover, your software program is concluding that form 7206 is required. Form 7206 is generated automatically by Turbotax in the Print Center when one requests to print "All official forms required for filing." Presumably, if I E-file, that form will be sent automatically to the IRS. The problem with that once again is that Form 7206 has 0 as the amount of the health insurance deduction at line 14, while line 17 of Schedule 1 states the actual amount of the deduction. The numbers should obviously be the same.

[JB923]

I just received rejection code R0000-058-01.  It appears to be associated with Form 7206 as well.  I've reviewed the form several times and I can't see anything the looks incorrect.  And, as you stated, turbo tax does the calculations, yet, it is triggering the rejection.  I am now getting a message that this section will not be ready to efile until 3/8/2024.  

[SS77771]

I am experiencing the same glitch and am frustrated.  According to the instructions for Line 17 of Schedule 1, I do NOT need to use Form 7206.  That's because I have Marketplace premiums reported on 1095-A, and I did NOT make advance payments of the premium tax credit and am NOT claiming the premium tax credit (nevertheless, Turbotax Online auto-generates a Form 8962 - which seems harmless, I suppose).  That said, I am supposed to use the 1040 Self-Employed Health Insurance Deduction Worksheet, not Form 7206.  My 1095-A insurance premiums are correctly linking to my Schedule 1, Line 17.  That should be the end of it.

Nevertheless, Turbotax Online is auto-generating and not allowing me to delete Form 7206.  I would be fine with filing an unnecessary Form 7206 if it weren't incorrect.  Inaccurately, it is BLANK (no entry) on Lines 1 and 3, when I believe it should show the aforesaid Marketplace premiums for myself as a self-employed sole proprietor.  Turbotax correctly links my 1095-A to my Schedule 1, Line 17 but fails to tie it to Form 7206.  As a result, Form 7206, Line 14 incorrectly says $0 for the self-employed health insurance deduction, which contradicts Schedule 1, Line 17.  This is inaccurate and I do not want to file with inaccuracies.  I tried just deleting Form 7206 by going to "Tax Tools" and selecting the delete button next to Form 7206, but it keeps re-appearing (perhaps because Turbotax also needlessly auto-generates Form 8962, which I also can't seem to delete).

HELP!  Although my Schedule 1 is correct, I do not want to file with an inaccurate Form 8962, as I suspect the inconsistency may trigger an audit.

[iusdcm1]

I only have one source of self employment income, and Turbo Tax is requiring that form 7206 be filed.  As the other user said, the self employed insurance expense is not carrying over to form 7206.  And while l see the form 7206 disclaimer, it does not print when form 7206 is printed.  

Please advise.

[iusdcm1]

I have the exact same issue! Only one source of self employment income, a marketplace plan with no premium credits, and an incorrect  7206 form (which is not required) that I cannot delete.  

[LindaS5247]

Have you tried running all of your updates to TurboTax?  You should run all of your updates when logging into TurboTax.

If you're on a PC, go in to your TurboTax program and select Check for Updates from the Online menu (top of screen). 

On a Mac, leave and go back in to TurboTax. If updates are available, you will get a prompt to download them.

Troubleshooting Tips:

• Use a wired, high-speed connection, this will save time and minimize any data corruption.
• Did your connection drop in the middle of the update?  Try again; it will pick up where it left off.
• If you're having trouble updating on your PC, try a manual update.

Please feel free to come back to TurboTax Community with additional information or questions or click here for help in contacting Turbo Tax Support. 

[iusdcm1]

I have run all my updates. The issue is that I cannot delete form 7206. My tax situation does not require form 7206 but Turbo Tax includes it in my return. Also the 7206 is incorrect so even if I wanted to file it, I can’t because it does not agree to Schedule 1. 
I spoke with one of your tax experts and she agrees the form will not delete. She is researching.  

[TC1079]

That's your answer? Have I checked for updates? The program automatically updates, and yes on top of that I checked for updates and it states that the software is current.

My question to you would be whether you or anyone else has referred this problem to someone with authority in your company who has the expertise to properly check the software and come up with a solution. In my case, I believe that form 7206 is required. Your program is generating that form and lists it under required forms to be filed with the IRS. However, the number on line 14 of Form 7206 that your software generates is 0. In contrast, the number on line 17 of Schedule 1 is $7,500. The 7206 worksheet follows this same pattern, but has a note of explanation at the bottom, explaining that the deduction of $7,500 for premiums paid through an exchange is included as an adjustment to income, but does not appear on the worksheet. That may be fine for the worksheet, but it's the final 7206 form that is filed with the IRS.  The instruction right next to line 14 on Form 7206 specifically states "Enter the smaller of line 3 or line 13 here, and on schedule 1 (Form 1040) line 17.  Turbotax is not doing that! It has $0 on form 7206 and $7,500 on line 14 of schedule 1. 

[iusdcm1]

Ditto!  Why isn’t TurboTax looking into this. 
I completely agree with you. 

[SS77771]

Thank you, but I am using TurboTax Online, so presumably any updates are applied automatically.  Are you suggesting there was a recent update pertaining to this issue?  If so, it hasn't resolved the issue on my end - I just looked at my draft tax return again, and the problematic Form 7206 is unchanged.