Software Error

[sharkbait]

I am using Home & Business version for my 2022 Tax Return on a Windows 11 PC. 

There is an error in Form 8959 - Additional Medicare Tax.  - Part II, Line 8 of that form says "Self-employed income from Schedule SE, Part I, Line 6.

The number on my Schedule SE, Part I, Line 6 is $151,400. Form 8959 Line 8 decided to double that amount and shows $302,800 and then computes we owe an additional Medicare tax of $475, which, of course, is wrong.

I hope this gets to someone that will actually acknowledge the issue and let me know it is being corrected. Last year I tried talking to a customer service rep who was worthless and couldn't understand a different simple computational error I was pointing out, it never got fixed and Since TurboTax won't let you e-file if you correct an error, I had to file with an error.

[smallbiz103]

I just posted about the exact same error in the Mac version!  Are you filing a joint return, and is the person with the self-employment income listed second in the "Personal Info" section?  That was my situation, and I figured out that if my spouse and I switch places, so the person with the self-employment income is listed first, the error goes away.

[Critter-3]

@smallbiz103 

That is a dangerous fix for many reasons like you will have to review all the sections to make sure you correctly indicate what belongs to whom for all the entries where ownership is indicated.  But the biggest one is switching places on a return (once those places have been established in prior tax years) tends to confuse the IRS and they don't process the return correctly which causes audit notices to be issued in the future. 

I would put things back and wait for the fix to be implemented especially since the IRS will not start processing returns until the end of the month...there is time to wait.

[sharkbait]

Thanks for the information. Since this is an obvious error in both Mac and Windows, I’m hoping TurboTax will correct it. I assume they monitor this site? We shouldn’t have to manipulate anything to make the software work.

[sharkbait]

I think you might be a little mistaken about the IRS getting confused when processing a return, they aren't. They are not looking or comparing prior returns to current ones being processed/input for paper filers. Also, most returns generated via TurboTax are e-filed and processed completely differently. Regardless, changing positions of filers on a return really doesn't create issues.

[smallbiz103]

I haven't found any official information on the consequences of switching places on a joint return.  @Critter-3 says it "...tends to confuse the IRS and they don't process the return correctly which causes audit notices to be issued in the future" -- I haven't been able to find official sources for any of those claims.  However, on page 14 of the instructions for the 1040 form (warning -- large PDF file: https://www.irs.gov/pub/irs-pdf/i1040gi.pdf), there's a "tip" box that says:

If you filed a joint return for 2021 and you are filing a joint return for 2022 with the same spouse, be sure to enter your names and SSNs in the same order as on your 2021 return.

[sharkbait]

From a practical standpoint and to avoid potential confusion, keeping things in the same order is probably best. However, I can assure you that tax examiners are not confused if that's not the case. I can tell you this because of my 7 years of employment at the IRS as a tax examiner after my "retirement" from the commercial world. 

[Critter-3]

30 years in the business + a partner with another 50+ years  have seen numerous IRS notices for missing spouse returns because they switched places  so it is not a good idea.  AND we both  taught the H&R Block income tax course and this was a point that was stressed in the text book as being unwise since it causes unneeded IRS confusion sometimes and BLOCK processes millions of returns  so I will take their warning seriously.   And it is not the auditors that have an issue it is the automated systems that are not all they should be ... the millions of $$ the IRS is getting to upgrade the systems have not arrived yet.