Turbo Tax - Still read irs instructions!

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bogleviewer
Posts: 349
Joined: Thu Aug 25, 2011 11:01 pm

Turbo Tax - Still read irs instructions!

Post by bogleviewer »

Turbo Tax is a great product and is my favorite consumer grade tax software. However, regardless of what software you use, it is always wise to be educated on the tax form instructions.

My wife and I had individual HDHP coverage until November at which point we both converted over to a family plan for November and December. The IRS instructions for form 8889 have a "TIP" stating "If you had family coverage on the first day of the last month, you do not need to use the worksheet; enter $6450 on line 3."

The issue is that with Turbo Tax it asks you what coverage you had for January, February, March, etc. So for the "step by step" guide I put January through October was self for both my wife and I and then Nov and Dec Family.

It calculated the Form 8889 designated as a primarily self plan (line 1) which changed many of the other lines.

Although the outcome was virtually the same, the form 8889 for myself and form 8889 for my spouse is completely different on almost every line if using what Turbo Tax suggests. However, again, the end result is virtually the same IN MY CIRCUMSTANCE (no over contribution).

Answering the tax software questions blindly has the potential to be different than what the IRS expects. The tip of putting Family Coverage if you had family coverage on Dec 1st makes form 8889 significantly easier to complete and looks cleaner albeit the outcome is the same (in my circumstance).
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