Form 8960 calc not matching IRS calc

Forum|Forum|3 years ago
April 19, 2023
1 reply
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My federal income tax refund received is $11,732 shorter than anticipated as calculated by Turbo tax. My IRS account indicates that they are calculating an addition Net Investment Income Tax (Form 8960) by this difference but don't show the inputs to determine how they calculated that. I have pored over my return, following the numbers through TurboTax and reading the Form 8960 instructions and recalculating manually, and I don't come up with what the IRS is. Has anyone else had this issue?

Mike9241

if this difference is entirely due to NIIT tax then then your line 16 and the IRS computation for line 16 for the 8960 differ by $308737 ($11732/.038). so you're probably looking for one big item that was excluded. you should receive a notification of the change including the details but you can call the IRS to inquire.

kmbelfordAuthor

Thanks, @Mike9241 $308737 seems to be the issue but I think for some reason they are treating it as passive earnings whereas it is Sched C loss from an active business (not passive) as my 8960 form Part 1, 4a & 4b have offsetting values +/- of $308737. But I don’t know why they would treat it as passive.

BrittanyS

If the IRS changed your return, you should receive a CP2000 notice that states what they changed and why. If you feel it is incorrect, you can respond to the notice with the explanation and documents to prove your claim.

@kmbelford

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