Roundin errors

Forum|Forum|4 years ago
February 23, 2022
1 reply
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When importing from tax software, rounding by Turbo Tax occurs on individual transactions instead of on 1099 total.

Spino

Alumni - Champ

Hello, AnnAtTaxes,

I think what you are saying is that the 1099 is itself a tax document, and TT should not round entries on the 1099. When this happens, you may be able to overwrite the entries, but if you do so, TT may then not allow you to file online because you have overwritten "calculated" fields which should have been imported as written instead of calculated. I have actually gotten a letter back from the IRS in a past year because of this problem.
However, if it is from other tax software, it is okay for entries to be rounded to the nearest dollar. It is only the official forms that should not be rounded. Mainly it's not a problem--where I ran into trouble was with 12 monthly entries that were rounded first, then summed, rather than being summed first, then rounded. In most cases the result is both insignificant and not a problem.
All the same, if it is a problem, go back to paragraph 1 :-).

AnnAtTaxesAuthor

Level 2

The 1099 I am referring to is my Social Security 1099, which exactly agrees with the (unrounded) total from my tax software. But TT's total is $6 more than this since each month's $.50 was rounded up to $1.00. All W-2's and 1099's I have ever seen contained unrounded totals, Do I need to pay taxes on this additional $6 simply because TT goes by different rules?

I have been using Turbo Tax for 30 years, and have never seen (or, at least, noticed) this to happen I think it is a new bug.

Ann

AnnAtTaxesAuthor

Level 2

I don't think it's new, but who knows. Even if you pay 50% tax on $6, you've only lost $3, which doesn't cover a lot of hassle. Your bigger problem might be that IRS sends you a letter saying they've corrected your return and takes the $6 back off. You can probably handle that without sweating too.

Normally, though, I've only seen annual totals on SS forms, so I'm not tracking with exactly what you're looking at, but the principle is the same. Don't sweat the small stuff :-).

I agree it would be nice if TT got this figured out, though. Life is imperfect and I have an operation for cancer later this week, also imperfect, but definitely an over $3 challenge. All the best, and keep checking those details!

It's more likely that the IRS would question Turbo Tax's result, since it disagrees with the 1099-R I received from Social Security (which I presume is what the IRS sees).

I really think you ought to correct this. Not everybody checks the numbers as carefully as I do, and lots of incorrect returns are being filed as a result.

Ann