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Proseries - IA 1040 Schedule B, federal obligations not taxed, where to enter?

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Level 3

I have U.S. government interest from a K-1 trust (Schedule K-1 Worksheet) and an Edward Jones investment account (Dividend Income Worksheet) that I'm not sure where to enter either one so that it flows through and ends up on Schedule B for IA 1040 under "Dividends Exempt from Iowa Tax". I thought I found where on the Dividend Income Worksheet under A5 "U.S. Govt. Interest included in total dividends" but that doesn't flow through to the IA 1040 Schedule B. 

I also tried for the Schedule K-1 Worksheet putting the U.S. Government interest portion of the dividends under Part III 2b "U.S. Bonds interest (nontaxable to states) included in line 2" but that doesn't flow through either to the IA 1040 Schedule B.

How do I enter the interest from federal obligations so that it ends up on the IA 1040 Schedule B under "Dividends Exempt from Iowa Tax" for a K-1 trust and an investment account?

Thanks,

Bree

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Level 4

 

Well dang, I have always used the A5 line.  I make a note and then when I get over to the IA I check to make sure that the amounts on line 2 and 3 are adjusted, and they always have been.  However looking at the schedule B, I see what you mean about it wanting a total and then non-taxable to IA amount.  I checked every year back through 2012 and the IA schedule B is the same set-up.  I've actually used the program since 1996 although I'm not willing to check all those years lol.  Even though IA is notoriously slow in notifying taxpayers when they don't like something they aren't that bad that I wouldn't have heard something on the 2012-2016 ones filed that way.  Bottom line is they are getting the correct amount reported on the return so I wouldn't worry about it.  

I am not able to answer your question about the K-1.  Does the adjusted amount show up in the first column.  If it does again I wouldn't worry about it.  Your only other option is a bunch of overrides to get it to fill out the schedule B correctly.

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Highlighted
Level 4

 

Well dang, I have always used the A5 line.  I make a note and then when I get over to the IA I check to make sure that the amounts on line 2 and 3 are adjusted, and they always have been.  However looking at the schedule B, I see what you mean about it wanting a total and then non-taxable to IA amount.  I checked every year back through 2012 and the IA schedule B is the same set-up.  I've actually used the program since 1996 although I'm not willing to check all those years lol.  Even though IA is notoriously slow in notifying taxpayers when they don't like something they aren't that bad that I wouldn't have heard something on the 2012-2016 ones filed that way.  Bottom line is they are getting the correct amount reported on the return so I wouldn't worry about it.  

I am not able to answer your question about the K-1.  Does the adjusted amount show up in the first column.  If it does again I wouldn't worry about it.  Your only other option is a bunch of overrides to get it to fill out the schedule B correctly.

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Level 3

Thank you! You made me realize I needed to check to see if ProSeries was doing the math to subtract out the federal interest without using the "Dividends Exempt from Iowa Tax" column and it was! So I did put the U.S. Government interest in the right spots. Thank you for your help, I should have checked that in the first place!

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Level 4

You are welcome and thank you for pointing out that there is a schedule that doesn't work as it should.  Proseries and IA have never played well together.  But I have to admit I don't believe I've ever looked at the schedule B.  You were going about it in the correct manner, starting with the schedule.  Proseries has made some improvements to IA in the last 2 or 3 years, so maybe they will catch onto this and get it to fill out correctly.

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