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TurboTax Tips for Investors with large number of charged off notes

Started by Peter, April 10, 2018, 11:00:00 PM

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Reginald

Notes on IRS Filing of Very Larger numbers Lending Club Records with Turbo Tax

Turbo Tax Error: "Your transmission did not go through. Please try again later"


By Reginald D. Sluggowski III
Tax Expert
04/11/2018
Summary: 
Do NOT import LendingClub data directly with Turbo Tax (any version) or you will be in a world of pain: Your processing will slow to a crawl, the totals on forms 8949 and Schedule D . Instead – Open the two 1099 forms (for each account) in the FORMS view rather than in the Step-by-Step Dialoge. They are: 1099-OID (interest – found on page 4 of the tax packet) and 1099-B (bartered transactions – ie carryover losses and recoveries). The 1099-B has 2 sections, Short Term , and Long Term. (box A and D respectively) the relevant data is the the sub-totals for each category of transaction. Do not report individual transactions list the sub-totals as a single transaction use the oldest transaction date of each group as the date of purchase and the newest transaction date of each group as the date of sale. Let Turbo Tax total the two.

PROBLEM:

Problem was due to LENDING CLUB transaction details in the Turbo Tax Form being just too large.  Surprisingly, Turbo Tax did not detect this as a problem, which shows you they dont really test their software in real life situations. 

SOLUTION: WHAT WORKED  FOR ME:

1. Make backup copy of the Turbo Tax file (found in ~/Documents/TurboTax/
2. Open the Return
3. Open Forms View (not step-by-step)
4. Find the 1099-B  (not the OID) for each Lending Club account
5. Delete the forms (use the menu at the bottom of the form when viewing it)
6. Add a new 1099-B.  Instead of listing each transaction, just use the sub-totals of the short term and long term (on your lendingclub pdf file - let TurboTax do the totals. Rememeber that each 1099-B worksheet has two parts - the top part you should use the pulldown for box-A,  the bottom half should use the pulldown menu item for box D (long term losses) .

This way the totals on form 8949 actually get calculated correctly! 

PREVENTING  THE PROBLEM:   (lesson learned- best practice for NEXT YEAR)

Do NOT import LendingClub data directly with Turbo Tax (any version) or you will be in a world of pain: Your processing will slow to a crawl, the totals on forms 8949 and Schedule D . Instead – Open the two 1099 forms (for each account). They are: 1099-OID (interest – found on page 4 of the tax packet) and 1099-B (bartered transactions – i.e., carryover losses and recoveries). The 1099-B has 2 sections, Short Term , and Long Term. (box A and D respectively).


Re the 1099-B  - note there are two sections to the Worksheet – One for Box A (short term) losses and One for Box D (long term losses) you need not fill out every field. Use LendingClub's SUB-TOTALS within the consolidated 1099-B as entries. Do NOT use every single transaction. Especially if its more than 1000 transactions. Use the oldest and newest transaction date for the buy and sell date respectively.



J2E

Interesting because I imported mine just fine and didn't encounter any errors.  I'm well over 100 loans.


Edwardnut

Thanks for the tip. It helped me a lot. It's very useful to me.



Half Right

Last year the import into Turbotax didnt work fir me as turbotax responded that it couls not handle more than 3,000 transactions. After emailing and complaining to turbotax last year, this year it was imported successfully with over 10,000 transactions. Took awhile but i prefer filing a 270 page tax return. Makes me think they may get discouraged from looking at it too closely.
But who knows

NEW LOANS:   | 804.eth 2.500 Ξ | remoraid.eth 0.299 Ξ | remoraid.eth 0.299 Ξ | ALL