Why sign in to the Community?

  • Submit a question
  • Check your notifications
Sign in to the Community or Sign in to TurboTax and start working on your taxes
New Member
posted Mar 14, 2021 3:19:11 PM

The IRS has a processing issue that is trigger Sch C, line 3, Gross Receipts Less Returns Allowances, reject incorrectly. Is this an update error on IRS /TurboTax side?

Description of error:
Data in the return is missing or invalid. Please double check your entries.
What needs to be done: You have two options: 1) You may wait to e-file your return at a later date when the issue is fixed (that date is currently unknown). 2) You may print and file your return by mail at this time.

2 20 3046
20 Replies
Expert Alumni
Mar 14, 2021 3:59:12 PM

To proceed, check your entries and post any returns and allowances as a miscellaneous expense instead. You will need to delete any amount from Line 2 of Schedule C to keep the correct net income as reported.

 

To return to Schedule C, enter schedule c in the search box inside TurboTax. Select the Jump to link in the search results. 

 

After at least one income type is listed, then Rebates and refunds will appear as an option under LESS COMMON INCOME. 

 

Instead, list this in the last category of expenses, Other Miscellaneous Expenses.

 

For more information, see: Tax Guide for the Self-Employed: Everything You Need to Know | The TurboTax Blog

 

Level 3
Mar 15, 2021 7:51:22 AM

THANK YOU!!!

This worked for me and my transmission was ACCEPTED by the IRS.

Level 2
Mar 15, 2021 9:05:39 AM

@LadyGourmet  Did you make the changes directly to Schedule C or the Schedule C worksheet?  

Just asking before I give it a try.

 

Thanks!!

Level 3
Mar 15, 2021 9:06:36 AM

I made the  changes to the schedule C.

Level 2
Mar 15, 2021 9:20:20 AM

@LadyGourmet  (which version are you using)? I am not seeing the options on Schedule C

could you share a screenshot if possible?  I can send my direct email if you'd like pls

Level 2
Mar 15, 2021 9:26:42 AM

@LadyGourmet  guess to clarify, I removed the entry from Line2 of schedule C, but do not see LESS COMMON INCOME section.  

Thx!

Level 3
Mar 15, 2021 9:40:41 AM

@MonaGayle1 -  I use the Home & Business version and the field actually the MISC section of the Schedule C.   This is how I navigated to the section.

  • Business --> Walk me thru everything
  • Business Income and Expenses --> Select EDIT for your business entry
  • Scroll down to Business Expenses
  • Select "Other Common Business Expenses"
  • Last section/entry on this screen is "Other MISC Expenses".  The amount removed from the other field was added here.

When I reran - no errors found.  When I submitted - no immediate rejections.  Received an email 20min later that the IRS accepted.  Guess I won't know for a week or so if there is a TRUE issue with submitting this way.  At least it wasn't rejected again.

 

Hope this helps....

 

 

 

Level 2
Mar 15, 2021 10:11:48 AM

@LadyGourmet   I definitely must be doing something totally wrong ... I have done this and still getting the immediate reject.  I do not understand.  Did you have to update TT for the hack to work? 

 
 

I am using the Home & Business version too.

 

I would just be happy to not see the Reject. :( 

Level 3
Mar 15, 2021 10:23:16 AM

@MonaGayle1 - Did you remove the value from Line 2 and add to the Other Expenses section?  It would not be reported in both fields.

Level 3
Mar 15, 2021 10:31:16 AM

@MonaGayle1 - this is the original message from the other Tax Expert and the instructions I followed:

 

To proceed, check your entries and post any returns and allowances as a miscellaneous expense instead. You will need to delete any amount from Line 2 of Schedule C to keep the correct net income as reported.

 

To return to Schedule C, enter schedule c in the search box inside TurboTax. Select the Jump to link in the search results. 

 

After at least one income type is listed, then Rebates and refunds will appear as an option under LESS COMMON INCOME. 

 

Instead, list this in the last category of expenses, Other Miscellaneous Expenses.

 

For more information, see: Tax Guide for the Self-Employed: Everything You Need to Know | The TurboTax Blog

 

 

Level 2
Mar 15, 2021 10:58:46 AM

@LadyGourmet I promise you I am not being a butt; and I appreciate you for coming back to the original thread with the update!!   

I'm probably too frustrated right now and can't see the forest for the trees.  

 

Let me see if we are having the same issue, because maybe that could be the problem.

The exact error I get on the reject is " Total gross receipts or sales" cannot be a negative amount. 

 

Was this the gist of your error?  

 

Also, the link finally opened, but I did not see anything specific to this issue.  

I guess I now need to know how to reach the tax expert you found the information from.  That would be helpful as well.

 

Thanks again 

Frustrated Filer 🙂 

Returning Member
Mar 15, 2021 11:19:52 AM

@LadyGourmet 

 

 

So did you move the entry from Line 2 and add it to line 27a on the Schedule C?

Level 3
Mar 15, 2021 11:58:43 AM

YEP - this is exactly what I did.  🙂 

Level 3
Mar 15, 2021 12:02:04 PM

@MonaGayle1  - this might be a part of the problem.  My message was not the same as yours.  But it sounds like they may be 'related' because it impacts the Schedule C.

 

The TAX EXPERT (via TurboTax) where I found this comment is listed below.  Hopefully if you reach out she can help you as well.   

Employee Tax Expert
 
 
 

Returning Member
Mar 15, 2021 12:10:55 PM

@LadyGourmet 

 

Thats weird, so when i take the amount that is in Line 2 remove it and add it to the total that is in line 27a I get the errors on my form for that amount and it says the errors in line 2 and line 27a are a problem.

 

 

Level 3
Mar 15, 2021 12:30:01 PM

@cewjr9842 - this is the ERROR message I received when the IRS was rejecting my returns: 

The IRS has a processing issue that is triggering Schedule C, line 3, Gross Receipts Less Returns Allowances, to reject incorrectly.

I'm not sure if our situations are the same; but the suggested corrective action worked for me and it did not change the amount of refund/tax payment due.  It provided me another way to report the same exact information.

Returning Member
Mar 15, 2021 1:52:48 PM

@LadyGourmet  

 

Yes, that is the exact same error I received. I am not sure why its not allowing me to make the exact same changes without giving me errors. I changed the value in Line 2 to 0 and then changed the took the value of Line 2 and added it to line 27a for the total but it states I have errors on those two lines. I also tried leaving it line 2 empty as well and still errors out. 

Level 3
Mar 15, 2021 1:55:52 PM

Interesting...

Then I'm not exactly sure what the problem is for you.  I just know that mine were "ACCEPTED" on the initial send.  Hoping that it goes thru but the IRS can always come back and ask that I correct it.  Right now its a "wait and see" period for me.  

Just keeping my fingers crossed..

Returning Member
Mar 15, 2021 2:10:19 PM

@LadyGourmet 

 

Ok. I think i figured it out.  I could not make the change from the actual form itself, I had to do it via the step by step, i was able to type all the refund item for line 2 into the miscellaneous fields and now line 2 and 3 are blank and I got no errors. I just submitted and crossing my fingers now awaiting an acceptance email. But we will see, thanks for your help and assistance on this. I will update if I am not accepted.

Returning Member
Mar 15, 2021 2:40:49 PM

@LadyGourmet 

 

Yes, that did it, it was finally accepted!

So we will see what they come up with! 

 

Thanks Again!