Question

Should CA real estate withholding not be entered to Federal to avoid being double calculated in Form 540 Line 71 and Line 73?

Forum|Forum|7 years ago
June 5, 2019
1 reply
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If I enter CA real estate withholding to Federal return "Estimates and Other Taxes Paid" -> "Other Income Taxes" -> "Withholding not already entered on a W-2 or 1099", this withholding amount will be added to Form 540 Line 71, which should actually not include real estate withholding. On Form 540, Turbotax adds line 71 through line 75 which causes real estate withholding being calculated twice on Form 540, since Line 73 has the withholding from Form 593.

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T

TerryA

Employee

When entering the 593 into the TT/Calif program, the amount of CA withholding on the 593 is subtracted from the amount going to Form 540 line 71 and is reported on line 73. So when properly entered there is no duplication.

To see this, open the Calif 540 in Forms Mode and scroll down to Side 3. Above line 71 is a Smart Worksheet that does the subtraction of Forms 592-B & 593 withholding on line B from the total withholding on line A. The 593 withholding entered into the federal return is in line A and the $$ entered into the 593 worksheet in TT/Calif flows to line B. The line B amount will flow to Form 540 line 73.

J

joanne-wuAuthor

On Tax Payment Worksheet, 2 X the real estate withholding $$ is entered to line 13 which produces an inflated Total income tax withheld in line 14 of the worksheet. On the Smart Worksheet, 1 X withholding is subtracted, and so line 71 on Form 540 still includes the remaining real estate withholding amount.