Why is there a zero on line 1a of my return when I input W2 information in during the interview process. The total AGI is correct._

Forum|Forum|3 years ago
March 3, 2023
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Best answer by MikeChicago

I’m glad you were able to get some better responses than I did. I decided to leave mine as is and report it on Schedule 1, line 8t. Rationale being, the income is still reported and taxed. My return was accepted by the IRS, but I do hope TT figures this out.

I agree that ultimately it shouldn't matter because the bottom line tax is the same. But I'd rather avoid the unnecessary hassle of a flagging of the return if their computers attempt to match W-2 amount to line 1 amount if Turbotax is not handling it correctly. There should, however, be an answer, even though the IRS instructions on the back of the W-2 seem to be conflicting with the purpose of the new line 8t on Schedule 1, and are certainly not clear. Here's the email I got back at my request following my phone call with support, which the rep said was the guidance that all the reps have access to:

Dear TurboTax Customer,
Thank you for contacting TurboTax Support.

Here is the information we discussed during our call:

You should leave box 11 blank when entering the W2 form in TurboTax. Go back and edit the W2 and blank out box 11 and continue through the follow on questions to complete the W2 entry.

There was an amount in Box 11 on your W2 and that you answered in the follow on question in TurboTax after entering the W2 information that the amount was taken out of your non qualified plan. Essentially what happens then is the amount is taken from box 1 and put on line 8t on Schedule 1. It is still taxable in the same way no matter which line it is on.

According to the instructions for the W2, the amount in box 11 is only informational for the taxpayer. The Social Security Administration uses the number in box 11 to verify that they have properly applied the social security earnings test and paid the correct amount of benefits. The SSA already has their copy of your W2 for their purposes.

This box has no affect on your income taxes.

MoniqueLO_

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@G2G0

G2G0Author

Thanks, but I’m referring to the output on the actual pdf. My return shows a zero in line 1a where wages from a W2 are to be entered. These wages are actually from a Pension fund, so I’m assuming that’s why TTax lists the income as if it were on a 1099R. That did not happen last year, so I’m confused.

CatinaT1

When you say your wages are from a pension fund, I'm not sure what that means. Was it a distribution from a pension fund?

Line 1a will show wages from a W2. Disbursements from a pension fund are not wages and will show on lines 5a or 5b.

Please let us know if you have additional questions.

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LindaS5247

Your W-2 is reporting a distribution to you from an unqualified plan, and not actual wages paid to you. This should be reflected in Box 1 and Box 11 of your Form W-2.

The prompts in TurboTax are asking if the box 11 amount is a distribution, answer yes here.

This box, 11, reports any amounts that were distributed to you from your employer's non-qualified deferred compensation plan or non-government Section 457 pension plan. The amount in Box 11 is already included as taxable wages in Box 1.

So it would be fine, per the above, to leave Box 11 blank when entering your Form W-2.

It should not affect your taxes due or refund due, it is more about getting it on the correct line. When you make withdrawals or begin taking regular payments from the annuity, that money will be taxed as ordinary income.

As always, keep all documents with your tax records.

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MikeChicago

Thanks for that. But I still wonder why we need to essentially override how Turbotax treats it by zeroing out the entry in Form W-2 box 11 in order to force the amount to Form 1040 line 1a. Why doesn't Turbotax just fix it in the next program update?