TT 2021 Form 8962 - Error calculating repayment limitation?

[smsaz]

Form 8962 was released today and there appears to be a glitch with how TurboTax is calculating the premium tax credit repayment.  My household income as a percentage of the federal poverty line was greater than 400% (line 5).  However, line 28 stills shows the repayment limit set as $2,700.  It is my understanding that limit does not apply when MAGI % FPL is over 400.  According to the IRS instructions line 28 should be left blank and you should be required to repay the full amount shown on line 27.  Is anyone else experiencing this problem?  I'm hoping someone will tell me that I misread the instructions and that I only owe $2,700! 😀

[GeorgeM777]

There could be an error in your wages and income entries.  As you indicated in your question, the obligation to repay part or all of the advanced premium tax credit is determined on how your household income compares on a percentage basis to the federal poverty line.   According to the IRS, if the amount on line 5 of Form 8962 is "at least 300 but less than 400," then the amount on line 28, for any filing status other than single, will be $2,700.  Because your return is currently showing an obligation to repay $2,700, it would appear that your household income is falling somewhere between 300% and 400% of the federal poverty line, which as you noted is not correct because your income is greater than 400% of the federal poverty line.  

In the Wages & Income section of TurboTax, please verify that your income entries are correct and make whatever changes are appropriate.  Additionally, under the Affordable Care Act, your health insurance cannot exceed 8.5% of your household income regardless of your income level.  You are entitled to a premium tax credit to the extent the cost of the benchmark silver plan in your area exceeds 8.5% of your household income.  If you received an advanced premium credit amount in excess of what you were eligible to receive, then you likely have to repay that excess amount.  

[smsaz]

Thanks, George.  I did confirm that my income is reflected correctly in the system.  Line 5 on form 8962 shows an amount greater than 400.  That should trigger line 28 to be blank based on what is written in the IRS instructions.  "Leave line 28 blank and enter the amount from line 27 on line 29 if any of the following situations apply to you:  Your entry on Form 8962, line 5, is 400 or more."  It still appears that TurboTax has a glitch in the form they just released.

[dk82]

Yes, I've experienced the same error. Posted about it here but no acknowledgement yet. My repayment limitation is listed as $1350 (which would the correct value for 300-400% FPL) despite my AGI being six-figure (well above the 400% FPL limit) and total subsidy being $4972. I've double-checked and even re-entered the income and 1095-A values. Also verified that this is not simply a TurboTax display issue -- the tax due is truly being calculated with the $1350 (or in your case filing jointly, I assume, $2700) value. Discussed with the IRS and they agree with my interpretation so seems to be nothing to do but wait for a TurboTax fix or file elsewhere.

[smsaz]

I'm sure they will get it fixed.  Lots of people will soon be reporting this error.  I only wish the TT calculation was correct!

[GeorgeM777]

The first day that Form 8962 is available for e-file in TurboTax is today, January 20, 2022.  Below, I have attached a link to the TurboTax Article which lists form availability by date.  Because today is the first day of availability for Form 8962, finish whatever remains to be done with your return, and reopen your return tomorrow and check the calculation for the repayment of the premium tax credit.  Provide a follow-up response if necessary, and just a reminder, do not include personal identifiable information in your follow-up response.  

IRS Form Availability Table for TurboTax

[Harold500]

I also have experienced this issue where line 5 shows 401% and the Repayment Limitation line 28 is showing 2,700 for MFJ status.  I first saw this when the form became available Jan 20.  I tried deleting Form 8962 and 1095-A and re-enter all the information.  Same as before.  All income has been entered correctly.  Obviously, a flaw in Turbo Tax.  Hope this gets resolved soon.

[Harold500]

Forgot to mention, I'm using Turbo Tax Deluxe.  So appears this flaw spans multiple products which one would expect for consistency. 🙂

[smsaz]

George - the form 8962 calculation error is still not resolved as of today.  It looks like other users are also experiencing this issue and will not be able to file their taxes until this is corrected.  Please escalate if possible.  Thanks.

[PSM1]

Hello.  I just submitted a question with the same situation.  I am showing a $2700 limitation, when I think I am really supposed to repay all the advanced premium tax credits.

[BillM223 · Accepted solution]

Thank you (all) for reporting this issue; we will be investigating it.

[Johnnat]

I have the exact same problem.  Thought the law changed but cant find anything

[bugreporter]

In my case, the percentage calculation itself is wrong (line 5). Instead of 425%, it calculates to 133%. Because of this, rest of the 8962 info is wrong. Please help to clear this. 

[GeorgeM777]

Additional review appears warranted.  In this regard, below are instructions on how to obtain a token number which can be used to retrieve a copy of your tax return for further review.  The retrieved return will not contain any of your personal information as such information is deleted before review takes place (the return you have prepared will still contain all of the information you entered as deletion of personal identifiable information only happens when TurboTax retrieves its copy of your return for review).    

Here are the instructions on how to obtain a token number whether you are using TurboTax Online or the TurboTax Desktop/Download version.

TurboTax Online:

1. Sign into your online account.
2. Locate the Tax Tools on the left-hand side of the screen. 
3. A drop-down will appear. Select Tools  
4. On the pop-up screen, click on “Share my file with agent.”
5. This will generate a message that a diagnostic file gets sanitized and transmitted to us.
6. Please provide the Token Number that was generated in the response.

TurboTax Desktop/Download Versions:

1. Open your return.
2. Click the Online tab in the black bar across the top of TurboTax and select “Send Tax File to Agent”
3. This will generate a message that a diagnostic copy will be created.  Click on OK and the tax file will be sanitized and transmitted to us.
4. Please provide the Token Number that was generated in the response.

As a reminder, in any follow-up response do not provide any personal identifiable information.  

[smsaz]

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