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Solved

E-file rejected due to ForeignTaxesPaidOrAccruedDt on Form 1116

Forum|Forum|5 years ago
February 21, 2021
59 replies
0 views

My federal e-file that I did yesterday (2/20/21) was rejected this morning (2/21/21) with the following message: "We encountered an issue processing your e-filed return. Please review the "ForeignTaxesPaidOrAccruedDt" on Form "1116" in the section "ForeignTaxCreditSource"."

All of my foreign taxes are on mutual funds held in a Vanguard brokerage account, so my numbers/data are coming from the Vanguard 1099-DIV.

I have run through the Foreign Tax Credit flow again and can't find anything to change/correct; I am ending up with the exact same results as before. In particular the date paid section looks correct, with the "paid" box checked (rather than accrued) and a date of 12/31/2020.

The only thing I was slightly uncertain about is that yesterday when it did the final review it asked me for "Qual Div and LT Cap Gains" for the foreign tax credit worksheet (and said this had to be greater than $0). I entered the "QDI eligible foreign income" value from the "2020 Foreign Tax Paid" section of my 1099-DIV. I am not certain this correct but do not see what other value would be appropriate to enter here. However, I also don't see how this would be related to the error message above.

I am wondering if this is a bug in TurboTax, as I had a similar experience last year where it was rejected due to a bug on their end, and had to wait until they had fixed the issue in order for it to get accepted.

Has anyone else encountered this? Or can advise on how to resolve it?

TurboTax Premier Online

Best answer by hongcho

A locally installed TT does not let you change the 1116 ATM date field and e-file (only print). When using simplified vs non-simplified, the difference seen on the 1116 ATM form is the data in column A (which includes the date). And... at least with a locally installed TT, I attempted to e-file at least a dozen times before it finally went through (using incorrect data that I plan to amend when this is fixed).

Turbo tax is making huge engineering, support, and PR mistakes here. I told them in this thread and on the phone within days of the forms being available (February) that this is going to affect, potentially, every customer filing a 1116 form and that it needs to be escalated and fixed NOW. I guess I was brushed off as being dramatic. I guess it is time to leave an amazon review.

I tried it again today. TurboTax (Windows) had an update.

This time, when I tried to e-file, TurboTax itself is rejecting it saying

"We Won't Be Able to E-file Your Return

"It looks like you have a form or tax situation in your federal return that TurboTax doesn't support for e-filing. We do support it for filing by mail.

"Here are the details:

"You elected the simplified AMT Foreign Tax Credit limitation. Print the return and file by mail.

"Don't worry, even though you are unable to e-file your return, we'll still help you file your return by mail."

So, it seems TurboTax gave up (?) on the simplified AMT Foreign Tax Credit limitation.

I am really tempted to change this.

Fossil

I have encountered the same issue -- my return was rejected with the same message. I also have a Vanguard account and entered the amounts from the 1099-DIV. I wasn't asked in the final review for "Qual Div and LT Cap Gains" -- the entry in Form 1116, Part I, line 1h. But this is simply carried over from the entry in Box 1b from the 1099-DIV and showed up in my Form 1116. After the rejection, TurboTax did tell me to go back to the section on "Deductions and Credits" and re-answer the questions for Foreign Taxes which I did. I did the review again and TurboTax said all was fine, so I e-filed again. And again it was rejected. So, I deleted my entries for the International Stock fund and re-entered them. Did the review again -- all was fine and e-filed again. And once again it was rejected.

It appears as if this is a bug in TurboTax and I guess I'll have to wait until they fix it.

sbsanonAuthor

@Fossil Thanks for sharing your experience; I appreciate the confirmation that it is not unique to me and thus definitely appears to be an issue on their end.

olsonep

Same issue. 100% foreign salary. It is the form. ForeignTaxesPaidOrAccruedDt refers to the Date. I found this on IRS, but have not figured out how to use this to work around the issue:

Problem on 2020 schema, last updated Jan 21, 2021:

Form 1116, Part II, Columns lA, lB, lC choice for ForeignTaxesPaidOrAccruedDt or ForeignTaxSpecialTypeCd, has changed to min=1 / max=1 making them a required choice. Only certain enumerations can be entered.

Temp Solution:

If selecting the choice of ‘ForeignTaxesPaidOrAccruedDt’, then enter a random date and attach a binary attachment explaining the correct literal that should have been entered. If selecting the choice of ‘ForeignTaxSpecialTypeCd’, then enter "1099 TAX" or "909 TAX" and attach a binary attachment explaining the correct literal that should have been entered.

steve200

I have the same problem and haven't figured a way around it.

Potatoes

Same problem here. I've just spent an hour going thru this and even deleting it to redo. No errors on the Turbo Tax error check, but still rejected by the IRS for that same reason. Neve had a problem in previous years with this, and considering so many other are having the same problem, there has to be a bug somewhere.

I'd rather not have to 'just file by mail' as Turbo Tax has stated as an alternative since my return is very large. I very much hope there is a fix for this soon.

karenll

After being rejected multiple times and speaking with a Turbo Tax representative I reentered everything and tried again. Another rejection. This time I changed the Various selections to 12/31/2020 and Voila

Return Was Accepted!!!

Disappointed that Turbo Tax didn't resolve the problem!!

olsonep

Last night I was able find somebody in support that understood the "big" issue here. It is not about finding my error or even how my taxes can get filed on paper. The real issue is that everyone e-filing a 1116 form will hit this error.... which could be 1000s or more. Spending an hour on the phone and telling then to not e-file will be a huge drain on their resources and make customers "dissatisfied". Many of us have larger returns and live in foreign countries and really appreciate e-filing.

There is a case open to fix their problem with the form. They added my email to the notification list for this bug fix. If more people complain and get added to the list then the priority may increase.

My current suspicion: IRS changed the "schema" (formal electronic format) on form 1116 (specifically the Date in section II) and introduced an issue. It does not appear that the IRS will change this for 2020 because they published a work-around for companies that submit electronic forms. Turbotax has not implemented this work-around.

sbsanonAuthor

@olsonep Thank you for the update and for spending the time on the phone with support. I am glad to hear that they are finally acknowledging it as a bug on their end.

Do you know if there is an easy way for others of us with the issue to get on the notification list for it (like emailing somewhere with a certain subject line)? (Ideally we wouldn't each have to spend on hour on the phone just to indicate to them that there is a lot of interest and to get notified when it's fixed...)

mokubabe

I received an E-file rejection "/Return/ReturnData/IRS1116/ForeignTaxCreditSource/USTaxWithheldOnDividendAmt - Data in the return is missing or invalid. Please double check your entries."

Have tried different things but every time it gets rejected.

Will call Turbo Tax to get my email on the list for notification when they correct the form.

I really don't want to wait to file my return so I may just go ahead and file without the Foreign Tax Credit and then file an amended return later after the update.

vident

I have the same error. But in my case, I am trying to claim tax withheld on Foreign Capital Gains. And also there is an entry from a 1099B from Fidelity from Dividend.

Pjjameso

Nothing works for me, tried manually entering etc etc. Have contacted support and believe they are working on the issue.

grsing

Same issue for me - form matches up completely with last year, passes all TurboTax checks, but was rejected with that error. Rechecked and resubmitted, rejected again within minutes.

Here's hoping TurboTax fixes it soon!

olsonep

I believe the internal case number is 11556 - it can be found searching for ForeignTaxesPaidOrAccruedDt on their internal system. (or 11556 is some work-related data, It was late and there are a dozen posit notes with numbers)

JacktheRipper

So, my foreign income and taxes on my TD Ameritrade 1099 included two investment funds of the "RIC" variety, but when loaded by TurboTax automatically, only the total of the two was loaded as a single RIC entry on Column A of Form 1116 Comp Wks. TurboTax reviewed that as fine, but it was rejected by the IRS. Two actions were needed to correct this, using the View>>Forms menu in TurboTax:

(1) I went to Form 1116 Comp Wks directly and in Part 1 I entered the two funds separately in Cols A and B (Special Note: the fund with the largest income must be listed first, in Col A).

(2) In Part 2 I entered the Country A line as the tax paid for the Col A fund, and Country B line as the Col B fund.

My tax liability after these changes were made was the same as before. So far the IRS has not rejected my return yet, but we'll see. I provide this as an early hint of a possible fix for those still frustrated by this....Jack

JacktheRipper

And I'm happy to report that the two actions I described above worked! My federal efile was accepted by the IRS.

TurboTax needs to correct how they download these 1099s. Clearly their method of only entering the total of the RICs does not meet IRS standards to efile.

olsonep

Some of us are getting this error entering a single salary from a foreign employer with nothing being imported into Turbotax. I do have one specific question that could be related. Since it is complaining about the date, could you tell us if your date changed when you split into two columns? And what magic date is making the IRS happy? (I'm trying everything). Thanks

Jamimo

I, too, have had two rejections even though everything checks out in TurboTax review and my own manual review:

"Return ReturnData IRS1116 ForeignTaxCreditSource USTaxWithheldOnDividendAmt - Data in the return is missing or invalid. Please double check your entries."

Interesting that there are different rejections for Form 1116.

Djszabo

ry going into Forms. Find the 1116 Form. Go the Part II. Under the Country column, my system was using the word "various". I changed this to 12/31/20. The submission then worked. Looks like there is a bug in either TT or the IRS system where only a date format is acceptable in that column Good luck.

deh47

I had same problem with filing being rejected but when I changed the pay date from various to 12/31/2020 the filing was accepted so thanks to whoever figured out the workaround. Interestingly, I had a conversation with a neighbor who does taxes for others using another software product and he had the same problem that was also fixed by plugging in a date. So, it would appear that the problem is with the IRS software. Still doesn't excuse TT for not being more proactive in getting the IRS to fix their bug or at least letting its customers know about the problem and how to get around it.

Fossil

TurboTax released program updates and I was hoping that they corrected the problem. I e-filed my return which was once again rejected by the IRS with the same error message. Still waiting for TurboTax to fix this issue.

tdog49

All,

Just spoke with a tax rep on turbo chat they are working on a solution and they have this chat as a reference, keep posting possible solutions, and if you have not contacted Turbo TAX do so.

olsonep

That is great news. The latest updates did not help. I tried some more date combinations with no luck. My taxes simple (foreign salary in a country with a higher tax rate). I start owing tax if it is not filed as a credit.