Schedule D Tax Worksheet - Can it be viewed in TurboTax?

[bobade]

I have been using H&R Block tax software for years (in order to file 1041 trust forms), but now that is no longer necessary. One of my great frustrations with Block is the inability to verify the accuracy of calculating the amount of tax due IF one has capital gains or qualified dividends. It has taken a while, but I can see from IRS forms that Line 16 (on 2022 Form 1040): "Tax" requires a mysterious, non-disclosed worksheet at the end of Schedule D Instructions called: "Schedule D Tax Worksheet". Understanding what that worksheet is doing is a whole 'nother challenge, which is not the issue here.

My question: Using TurboTax Premier, can you actually generate a completed Schedule D Tax Worksheet so you can inspect, understand, and verify how your tax liability is calculated?

[DoninGA]

The TurboTax software will include a Schedule D Tax Worksheet if required based on the investment sale to calculate taxes on the taxable income. 

It will also include a Qualified Dividends and Capital Gains Tax Worksheet if that is required to calculate the tax on taxable income.

You would want to use any of the TurboTax desktop editions which have a feature called Forms where you can access all the forms, schedules and worksheets included in your tax return.

TurboTax desktop editions for tax year 2022 - https://turbotax.intuit.com/personal-taxes/cd-download/

[Anonymous_]

[bobade]

Thanks, Don. That's good news, in true. The Block software does NOT show that worksheet in forms, even if worksheets are also shown, and their tech support idea how to generate it.

[bobade]

I'm sold!!! In less than a minute, too!

[rjs]

The Schedule D Tax Worksheet might not be used to calculate your tax. It's only used if you have a non-zero amount on Schedule D line 18 or 19, or in some cases if you are filing Form 4952 for an investment interest deduction. Otherwise the Qualified Dividends and Capital Gains Tax Worksheet will be used if you have qualified dividends, capital gain distributions, or net long-term capital gain. See the paragraph at the top of the Schedule D Tax Worksheet in the Schedule D instructions.

[bobade]

rjs, thanks for teaching me something. I hope I'm correct in presuming that TurboTax will show the Qualified Dividends and Capital Gains Tax Worksheet, too.

Interestingly, I looked in 2021 Block software that has my completed return. The Qualified Dividends and Capital Gains Tax Worksheet is also not present. Could Block be thinking that tax DIY'ers are too ignorant to want to see exactly how their tax amount is calculated? 

[rjs]

You're welcome. Yes, TurboTax will show whatever worksheet it uses to calculate your tax, including the Qualified Dividends and Capital Gain Tax Worksheet if that's what it uses.

There are actually seven different methods that can be used to calculate the tax on Form 1040 line 16, depending on what types of income you have and other things in your tax return. The IRS instructions for Form 1040 line 16 explain the conditions for determining which of the 7 methods to use, starting at the bottom of the middle column on page 33 of the 2022 Instructions for Form 1040.

In TurboTax there is a Tax Smart Worksheet that has 7 checkboxes that show you which method TurboTax used. In the CD/Download TurboTax software you can see the Tax Smart Worksheet in forms mode. It's between lines 15 and 16 in the first section of the Form 1040 or Form 1040-SR Worksheet.

The seven methods of calculating the tax are the Tax Table, Tax Computation Worksheet, Form 8615, Schedule D Tax Worksheet, Qualified Dividends and Capital Gain Tax Worksheet, Schedule J, and Foreign Earned Income Tax Worksheet.

I won't speculate on how H&R Block decides which worksheets to show you, or what they think of their customers.