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Basic is not including 2017 state refund as income for 2018----are you aware of this problem

pac727
Level 1

2017 was an itemized return so state refund received in 2018 is taxable

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IRonMaN
Level 15

Have you reviewed the state refund worksheet to see if it makes sense?


Slava Ukraini!

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14 Comments 14
IRonMaN
Level 15

Have you reviewed the state refund worksheet to see if it makes sense?


Slava Ukraini!
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renee1617
Level 1
on my one it was saying that the amount couldn't be more than the over payment amt which was a large number due to a childcare credit
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IRonMaN
Level 15
So are you saying that your client didn't get the benefit from the deduction which would mean it isn't taxable?

Slava Ukraini!
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renee1617
Level 1
yes...... should that be an error showing up
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IRonMaN
Level 15
If they didn't get any benefit from the deduction, it isn't taxable - there isn't any error to report.

Slava Ukraini!
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LilFos
Level 3
I am having similar issue. It seems the st refund wks checks the General Sales taxes check box by default (C2) even though the client itemized last year AND deducted income taxes (C1) what I have been doing is simply check box c1 and update but should not that have calculated automatically when transferring the client?
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pac727
Level 1
Yes----that is exactly the issue. With a program this expensive, we should not have to manually perform this step. Also, be careful with multi-state returns----even with the manual override, taxable refunds still not being calculated correctly in all cases.
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IRonMaN
Level 15
There was a bug in the early release. You need to delete the clients that you transferred earlier and re-transfer them to correct the issue.

Slava Ukraini!
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danthetaxman
Level 3
Ironman, you are 100% correct.  Why hasn't ProSeries notified everyone of this enormous error?  
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IRonMaN
Level 15
Communication isn’t really intuit’s strong point.

Slava Ukraini!
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taxman3132
Level 1
i got the same response from pro series when i ask this same question.  i have the professional version. the software should look back at the 2017 return to see if client chose sales or income tax and computed the taxable refund for 2018.  it is not.  i have to go into each client and choose "income tax" .  the program is defaulting on C2 on every client i have.
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danthetaxman
Level 3
If you delete your client, and re-proforma the client it fixes the problem.   Probably easier to just check the box instead of doing that.
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renee1617
Level 1

I think im having the same issue on one return..... are you talking about box f ?

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ART-YOUNG
Level 1
On the worksheet change the year from 2017 to 2016 or 2015 and it will work.
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