TurboTax is one of the renowned softwares which many businesses use for filing taxes and preparation. It has various features that offer convenience to its users and make the process easier and swifter. The software suits small and medium-sized businesses, self-employed individuals, etc.
You can use this software to file many different forms related to tax, and Form 8960 is among the many forms which are available from the IRS. However, along with the option of providing many features, the chance of errors and bugs is inevitable, which can ruin any user’s experience.
In this blog, we will be providing you with fixes for the error that can occur due to issues with form 8960 in TurboTax.
What Is Form 8960? Who Can File It?
The purpose of IRS Form 8960 is the calculation of total NII (net investment income). It then determines the amount of contribution that goes to Medicare contribution tax. The form is applicable to taxpayers in the high-income bracket. If you have investment income and your MAGI (Modified Adjusted Gross Income) is above the threshold, you are eligible for the net income investment tax (NIIT). Anyone who earns income from investments in a year may also have to pay net investment income tax.
The NIIT is a 3.8% tax on the net investment income or the MAGI exceeding the threshold income. As for the threshold, it is as follows:
- The modified adjusted gross income or MAGI for a joint filing return or by widow must be more than $250,000
- For married individuals filing separate returns, the MAGI must be more than $125,000
- If you are the head of a household or a single individual, your MAGI has to be $200,000 or less.
Read More:- How To Start Over On Turbotax Online And Mobile App?
What Does Form 8960 Contain?
The first part of the form entails the different types of income which you can consider as investment income. Here are some examples of investment earnings such as dividends, rental property income, interest income, income from trading stocks, etc.
The second part of the form has certain investment-related expenses, which are deductible from the total investment income in part one of the form. These expenses can be the cost of hiring an advisor, tax payments to state and local governments, brokerage fees, interest payments, etc.
Common Form 8960 Error In TurboTax And Ways To Fix
Now that we understand what Form 8960 is about, let’s move on to the main topic. The users of TurboTax have been encountering various errors, and many of them are related to Form 8960 in one way or another. We will mention some of the possible ways to fix them.
Rejection Code “F8960-0190-04” Processing Error
This error will not let you file a federal return electronically due to an error in processing Form 8960. The officials from TurboTax stated that the issue would be resolved in February, and you would be able to file returns again electronically. Note that the issue is not with the software but with the IRS itself. If you are still not able to do so, the following fix may work for you:
- Try deleting the form from the software if there is no need for it.
- If you do need the form, you can wait for the issue for IRS to fix this issue since it is not originally a TurboTax issue.
- There is also a possibility that you are using an outdated version of the software. Try updating to the latest version of the software. Restart your system after the update.
- You can also go to the option of re-submitting the form and then try to file for returns.
Since the error originated due to an issue with the IRS, the one thing you can do is wait for an official update from IRS or TurboTax regarding the issue.
Conclusion
Form 8960 holds a lot of relevance when we talk about NIITs. The IRS uses this form to maintain records on the net investment income that people earn in the US. The form is also available on TurboTax for filing. However, you cannot get rid of the errors and issues during its usage due to the large user base. Also, there is no such thing as error-free software. If you also come across such cases where regular fixes do not work, you might require professional support as regular fixes don’t work.
MWJ Consultancy is among the leading TurboTax professional’s service offering resolution in a variety of errors. We have a expert team of experienced and skilled professionals who can help you with issues in TurboTax and various other softwares such as Quicken, QuickBooks, etc. Our services offer assurance on top of affordability. To get in contact with one of our professionals, contact us at info@mwjconsultancy.com or +1 877 469 0298.
Frequently Asked Questions
The error code 8960 in TurboTax can refer to form 8960, which is related to net investment income tax. This issue is due to a system error by the IRS, and once they resolve the issue, TurboTax will make adjustments accordingly.
Form 8960 is available on all versions of TurboTax software.
The IRS did provide a date on the resolution of this issue which was 19 Feb 2023. You can check if you are able to file the form electronically. If the issue still exists, you can contact our support service because there may be an error somewhere else that is not allowing you to file returns and fill out the form.