We noticed two TaxSlayer changes that affected Massachusetts returns this week.
- You are now required to enter an amount (even if it’s 0) for the Circuit Breaker credit in the custom questions/credits section of the efile process. This was always a required entry, but defaulted to 0.
- When completing the MA Schedule HC, the insurance company’s EIN now defaults to 12-3456789. You can ignore that if there is no private insurance. If there is private insurance and you know the EIN, simply overtype the default with the correct EIN. We have heard of instances where preparers couldn’t overtype the default – in that case, simply ignore the EIN and just enter the subscriber number.
Last week Massachusetts was rejecting returns in which the taxpayer chose to pay the optional higher 5.85 percent tax rate with a reject code of F1-1025 or FNRPY-1025. While this probably doesn’t affect many of our returns, if it does, please see this TaxSlayer blog post for more detail and resubmission instructions.
A few questions came up this week that others might have as well.
Question: Can I efile a Massachusetts amended return?
Answer: No. You must paper file the amended return.
Question: How do I link multiple 1099-MISCs to a single Schedule C?
Answer: Enter the first 1099-MISC and create a new Schedule C. Then create and enter the next 1099-MISC. The screen will open that shows the existing Schedule C and asks if you want to create a new one. Simply click on the edit pencil for the existing Schedule C and the 1099-MISC will be added to it.
For TY2017, there is a change to how we handle the situation in which a member of the tax household died or was born/adopted. Previously, we had to account for every month and request an exemption (code H) on Form 8965 for the months after death or prior to being born/adopted. This is no longer the case. You should only claim this exemption if you are also claiming another exemption on a Form 8965. If every family member had coverage – before death or after birth/adoption – that is considered full-time coverage.
Congress passed the budget last week and it included a retroactive re-extension of several of the extenders that expired on 31 December 2016 to 31 December 2017. This includes:
- Exclusion from gross income of qualified principal residence indebtedness (always out of scope for Massachusetts Tax-Aide volunteers)
- Mortgage insurance premiums deductible as qualified residence interest
- Deduction for qualified tuition & fees
- Residential energy credit
These have not been incorporated into TaxSlayer yet; we’ll let everyone know when they are. You might consider holding any returns that would be affected to avoid a later amendment.
Reminder for counselor and EROs – you cannot e-file a federal return with a $0 AGI. See the NTTC annotated version of 4012, page 11 (bottom) for instructions on what to do to allow e-filing.
TaxSlayer will create and transmit the appropriate Profit or Loss from Business schedule – Schedule C or Schedule C-EZ – to the IRS. You should include both in your custom print sets to enable printing of whichever schedule is created. Note that Massachusetts uses only MA Schedule C.
We believe that the Circuit Breaker issue that we posted about on 30 Jan 2018 has been resolved. You can fill out and save the Circuit Breaker screen for homeowners without any errors and subsequently efile the return successfully. If anyone encounters a problem, please up-channel the issue through your management chain so everyone keeps abreast of the issues.
The IRS SPEC released guidance on 1040-ES (estimated payment) forms that TaxSlayer posted on their blog yesterday. In summary….
The IRS is continuing to update its programming and processing systems for some 2018 forms impacted by the Tax Reform Act. This includes Form 1040-ES, Estimated Tax for Individuals, for all software vendors. IRS expects to release this form to software vendor in mid-February.
Once the form is released TaxSlayer will update the software with the correct 2018 Form 1040-ES. Until this form is released by IRS, VITA/TCE sites should not provide the 2017 coupons currently printing from the software to the taxpayer.
See the linked post for further details.
The updated Massachusetts Resource Guide – aka Mass Manual – dated January 2018 is now available in the Reference Material tab. We also included a list of changes made from the October 2017 version. We left the previous versions of the manual online (clearly labeled) in anticipation of someone needing to prepare or amend a 2016 return.
The NTTC also released an updated Tax-Aide Scope Document (version 3). You can download this document directly from One Support. None of these changes appear to affect us, but it’s still a good idea to have the most current version available.
For new volunteers — you will get an invitation to the volunteer portal and One Support — the data repository for Tax-Aide — when we submit your names on the certification list.
We are aware of the problem creating a MA Schedule CB — where you are asked for the landlord’s information even though you specified that the taxpayer was a homeowner. The software does not allow you to save the form without entering the landlord’s information.
This has been reported to TaxSlayer and the Massachusetts Department of Revenue. We do not have an estimate on when this will be fixed, but will post an update to let everyone know when we hear something.
We have two suggestions:
- Fill out the landlord’s information using the taxpayer’s address. Put None for landlord’s name. Data can be saved. Print the return and paper file it. In the tests we have run, Schedule CB looks correct in this situation, so there should no issue sending a hard copy to the DOR (remember to black out the bar coding).
- Put the return on hold until this issue is resolved.
We agree that neither is a good workaround.
The NTTC has released an annotated version of 4012 for Tax-Aide volunteers. You can find this document on the One Support Help Center. We highly recommend that everyone download a copy and have it available at each site electronically. For those who prefer printed documents, you can download just the key change pages plus a list of all updates so you can make other pen and ink changes. [Note that two updates have been released – so check to make sure you have the latest version.]
We have also updated our Massachusetts Tax-Aide Scope. This will be included in the latest update to the Massachusetts Resource Guide (aka Mass Manual) as Section 3. We are working on the update now and expect to have it published sometime the week of 29 Jan. We highly recommend that everyone download a copy of this PLUS the latest Tax-Aide Scope Document, also located on the One Support Help Center, and have them available at each site.
The TY2017 Lowest Cost Bronze and Second Lowest Cost Silver Plan calculators have been posted. You can find them here or or via the link on the right hand sidebar on our website.
TaxSlayer notified us that they have fixed the Safe Harbor Tax calculation issue and we have verified that the calculation is now correct.