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After further research, I believe there is a flaw in how TurboTax handles this scenario. Based on the worksheets in Publication 915 (Worksheets 1, 2, 4), the instructions guided me based on my situation to put “LSE” for the Lump-Sum Election in box 6a and “0” in 6b.
The flaw is: Any entry in 6a that does not equal more than the lump sum totals for prior years in TurboTax causes the review to find an error and force you to print the return rather than efile, because you then have to fix it yourself and mail it in which is unfortunate after paying so much for TurboTax. Nowhere does TurboTax allow you to complete these worksheets or figure out the LSE entry behind the scenes.
In my situation, I earned approximately the amount for 2023 that I had estimated to the Healthcare Marketplace and when I talked to them they verified that estimation was close to what I had gotten for 2023. I will also be attaching Form 8275 with an explanation of my reasoning with supporting documentation and the Pub 915 worksheets. This should be something I could do within TurboTax, but sadly is not.
This is flawed. See my explanation above. My income for 2023 was not the lump sum amount. My income was what I received for 2023 and adjusted gross income was much lower.
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