The IRS in https://www.irs.gov/pub/irs-pdf/p590a.pdf page 45 states " Eligible contributions. These include 1. Contributions to a traditional or Roth IRA; 2. Salary reduction contributions (elective deferrals, including amounts designated as after-tax Roth contributions) to: a. A 401(k) plan (including a SIMPLE 401(k)), b. A section 403(b) annuity, c. An eligible deferred compensation plan of a state or local government (a governmental 457 plan), d. A SIMPLE IRA plan, or e. A salary reduction SEP; and 3. Contributions to a section 501(c)(18) plan. They also include voluntary after-tax employee contributions to a tax-qualified retirement plan or section 403(b) annuity. For purposes of the credit, an employee contribution will be voluntary as long as it isn’t required as a condition of employment."
Then in the next paragraph, the IRS identified the reductions to that. Specifically, " Reducing eligible contributions. Reduce your eligible contributions (but not below zero) by the total distributions you received during the testing period (defined later) from any IRA, plan, or annuity included above under Eligible contributions. Also reduce your eligible contributions by any distribution from a Roth IRA that isn’t rolled over, even if the distribution isn’t taxable."
I bolded the critical part as it appears that TurboTax is including any plan rather than only plans included under Eligible contributions. Specifically, TurboTax states "Roth IRA, traditional IRA, and qual plan distributions" in determining the value for line 4 and does not determine whether those plan distributions are under Eligible contributions. Thus it appears that Turbotax is not providing you with your maximum refund. If this is the case, will the maximum refund guaranteed apply?
