Idaho child and dependent care deduction- turbo tax error on worksheet?

Forum|Forum|2 years ago
February 13, 2024
2 replies
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Idaho Form 39R, Line 6 (child and dependent care deduction), directs to worksheet. Line 1 of the worksheet asks for the amount of qualified expenses and states: "Do not include amounts . . . excluded from taxable income."
TurboTax entered the total amount of qualified expenses and did not reduce by reimbursement received from a dependent care account. Is that an error? Shouldn't it be the amount of the qualified expenses excluding dependent care benefits? What am I missing?

TurboTax Deluxe Online

Best answer by AmyC

We were applying logic and I re-read the instructions. Page 30 shows the same form but explains the difference in calculations and Idaho is giving you the most benefit possible. Your employer paid amount is in the calculations but the final answer may not include those payments. Yours is one of those times. You are good to go.

JohnW152

There's no known error with this Idaho computation.

You're correct that line 1 of the Child and Dependent Care Worksheet in the Form 39R, Resident Supplemental Schedule shouldn't include amounts excluded from taxable income.

However, look at line 3 of the worksheet: "Enter excluded benefits from Part III of Form 2441." The line 3 amount would be the computation from line 25 of Form 2441.

Has this amount from Form 2441, if there is one, been subtracted in the worksheet formula?

mgoicsAuthor

Thanks for the quick response. Yes the excluded benefits are considered in line 3 in the worksheet for comparison with line 1 (not deducted from line 1), so don't appear to be accounted for if Line 1 ends up being the lesser amount. Also why would the instruction include the admonition to not include amounts excluded from taxable income if it intended for that amount to be incorporated later?

For illustrative purposes:

1. Enter the amount of qualified expenses you incurred and paid in 2023. Don’t include amounts paid by your employer or excluded from taxable income: TurboTax inserts the amount from IRS Form 2441, Line 1(e) (total amount of expenses not reduced by any reimbursement amounts) $5000 for purposes of example.

2. Enter $12,000 for one or more child or dependent cared for during the year: $12,000

3. Enter excluded benefits from Part III of Form 2441: $2,500

4. Subtract line 3 from line 2. If zero or less, stop. You can’t claim the deduction: $9,500

5. Enter your earned income: $100,000

6. If married filing a joint return, enter your spouse’s earned income. All others enter the amount from line 5: $100,000

7. Enter the smallest of lines 1, 4, 5, or 6 here and on Form 39R, Part B, line 6: $5,000

Shouldn’t line 1 be using the amount fro IRS Form 2441, Line 2(d) (amount of expenses not including reimbursed amounts)?

AmyC

Employee

It is supposed to be coming from 2d according to the data source. I can track mine back to line 2d of the 2441 which makes me wonder if there is another issue. You should be receiving credit if you had taxable expenses above your pre-tax dollars.

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