PTC and state items

[perry]

i am in Minnesota and also do Iowa returns. Has anyone heard how these states are handling the 10,200 non taxable unemployment? I heard on news that MN Republicans had this exempt in their proposed budget they just submitted. But as i understand, that is a long way from being law. Iowa has what they call rolling conformity, they conform to federal changes unless they specifically rule they will not. Have a client, MN resident, wife works in IA and rec'd IA unempl. Drake software subtracts the 10,200 off the IA 1040 but on the IA 126 it is not listed as a subtraction or adjustment to income. Not sure IA does not allow subtraction of unempl or if this is waiting for a software adjmt. Have another client who rec'd unemployment, on MNSure and is just over 400% poverty level so has to pay back all PTC. I thought 10,200 unempl not being taxed would bring them down below 400% and only have to pay back 2,700 PTC. But worksheet in Drake for 8962 modified AGI is including 10,200 unempl not taxed. IRS form 8962 instructions for modified agi lists only foreign income, tax exempt interest and non taxable social security that needs to be added to agi to get modifed agi. Would appreciate any comments suggestion on this.

My opinion is IRS needs to extend filing deadline.

[TaxGuyBill]

But worksheet in Drake for 8962 modified AGI is including 10,200 unempl not taxed.

Somebody else reported that error about Drake. Hopefully they will fix it soon.

As a side note, the new law also says that NONE of the PTC needs to be repaid. But I don't think the software is update for that yet.


As you said, it seems like Minnesota won't be passing that Unemployment thing soon, so it should be added back on Form M1NC. *IF* Minnesota does eventually change the law, hopefully the Department of Revenue will automatically adjust things.