Not eligible for electronic filing?

[pcguru23]

During the final review of TurboTax, I'm getting a message that my tax situation makes my federal return ineligible for e-filing because the following Form 1040 lines have a zero value: 6, 7, 11a, 11, 12, 15 and 18.

[rickwm]

I have a slightly different issue.  Using another tax software (not Turbo Tax), I was able to get all the way to the point of E-Filing, and then it wouldn't let me E-File because:

"This return cannot be electronically filed because you have a line entry on Schedule B for previously reported bond interest adjustment".

This relates to the fact that years ago I switched to an accrual method of interest reporting on my EE Savings bonds, which I purchased in 1992. In Tax Year 2019 I cashed in one of these bonds and received a 1099 from the bank showing all the interest that had accrued since 1992, even though I had already paid taxes on prior years. That's why I needed to make the Schedule B adjustment.  The other software handled this properly and created a proper Schedule B with the wording required by the IRS, but it still would not let me E-File. My question is if I switch to Turbo Tax and enter all the same info, will your software also not allow me to E-File due to this Schedule B issue?

[VictoriaD75]

Generally, a change in accounting method, such as the accrual of interest and reporting, must be paper filed due to IRS processing requirements, not software requirements. 

[rickwm]

I understand that - and that does make sense.  But just to be clear, I made the change in the reporting method a good eight years ago.  I have been reporting the interest on these bonds since 2012, and have done so electronically for most of those years.  Only difference this year is that I actually cashed in one of the bonds, which is why I need the Schedule B entry to adjust the 1099 figure.   And, as noted, the software I used generated the Schedule B form exactly the right way and exactly the way it would look if I were doing it manually.   So it strikes me as odd that the IRS won't accept an e-file on a schedule B that looks the same as it would be on a manual file.

The original point of my posting here was to ask if I would run into this same problem if I used Turbo Tax instead of the other product.   Your point is yes, I probably would, because it seems this is more of an IRS requirement than a specific software problem.   But is there any way I can be sure of that?

[ThomasM125]

You are correct, it is the IRS that is denying the electronic filing. The only way to test this would be to prepare the return on another software and see if you have the same issue.

[rickwm]

Well that's the sort of the reason I posted here.  I'd like to know if I would encounter the same problem using Turbo Tax, which I'm sure can process the schedule B correctly.  But I would not be able to E-file with Turbo Tax unless I pay to use the product -  and I would hate to pay for Turbo Tax only to find out that I have to file manually anyway.   Is there some way I can find out from Turbo Tax if anyone has successfully E-Filed with them who is filing a Schedule B with the savings Bond accrued interest adjustment I am  making?  My situation is not unusual.   Many long-time savings bond holders have made the same switch to an accrual method that I made, and I am sure many people have to make this kind of Schedule B entry.  I would think someone at Intuit or Turbo Tax should be able to tell me if I will have a problem E-filing in this situation.

[MarilynG1]

@rickwm, No you won't have a problem efiling when you adjust your Cost Basis on your 1099-B for your bonds.

You are correct, many are in the same situation. 

[mmurrell1]

U.S. Savings bond interest is reported in box 3 of a 1099-INT.