2011 ProSeries/1040 ReadMe

Release 2011.15h / November 21, 2012

Click on any of the links below to go directly to the topic of your choice.

All 1040 Forms can be filed

Items addressed in previous releases of ProSeries

What's new in ProSeries/1040

New ProSeries/1040 forms and worksheets

Obsolete ProSeries/1040 forms and worksheets

Tax legislation issues

Electronic filing

All 1040 Forms can be filed

All forms in this release of ProSeries/1040 can be filed with the IRS.

Items addressed in this release of ProSeries/1040

The following issues have been fixed in this release:

• A Client Analyzer Query has been modified to identify tax returns with a form 8938 that may have been electronically filed incorrectly.

Items addressed in previous releases of ProSeries/1040

The following issues were fixed in prior releases

• A Client Analyzer Query has been added to identify tax returns with a form 8938 that may have been electronically filed incorrectly.
• Form 2848 has been updated to match the March 2012 IRS revision.
• A problem of efile rejects for a missing Form 8862 when a 8862 is correctly filed has been corrected.
• An error message has been corrected that occurred when entering the direct debit date for the first estimated tax payment.
• An error message that ProSeries cannot calculate your return after Form 4868 is efiled has been removed.
• The Student Information Worksheet was corrected for a bug introduced in Release 2011.140. Box 5 scholarship information entered directly into Part IV of the Student Information Worksheet was not reducing the amount of qualifed education expenses for purposes of determining an education credit or deduction.
• The qualified Honda vehicle model was corrected to "FCX Clarity" from "Civic GX" on form 8910, Alternative Motor Vehicle Worksheet.
• A box 5 reconcilliation has been added to Form 1098-T to allow veteran- or employer-provided assistance to be broken out from amounts in box 5. The box 5 amount was previously assumed to contain only scholarships and grants.
• Schedule B, Part III, line 7(b) has been updated to allow the entry of more than one foreign country code.
• On Form 2555, the calculation of the number of days qualified in the current year has been changed back to using the physical presence start date without regard to the date that the tax home date was established.
• The program has been corrected to prevent doubling of the 2010 pension to Roth conversion amount in line 3 of the Social Security Benefits Worksheet if there was no current year Roth IRA distribution. This bug was introduced in release 2011.6.
• The Middle Class Tax Relief and Job Creation Act of 2012 extended the 2 percent payroll tax cut through 2012. This will reduce 2012 estimated tax payments (Form 1040-ES) for individuals with self-employment income and whose estimated tax payments are based on 2012 income.
• Text and help were added to Form 1098, Mortgage Interest Statement, to clarify that this is not a required statement. It was designed to support import of Form 1098's into the product.
• An error message on Form 1040, line 63, preventing efile when estimated tax payments exceed taxable income has been removed.
• Form 8606, line 29 was corrected to not allow a negative number.
• A Schedule C-EZ transferred from the prior year with no dollar values in the current year will no longer be efiled with the return to prevent the efile reject error.
• The program now provides separate copies of Form 2848 Power of Attorney for taxpayer and spouse. The IRS requires the taxpayer and spouse to each file their own separate copies of Form 2848 when the power of Attorney applies to a year in which a joint return was filed.
• For customers who have transferred their Paid Preparer/Rates per Form in versions of the Pro Series product prior to 2011.060, be sure to check your rates under Tools; Billing; Rates per Form to ensure that the rates per form are listed accurately. There's a possibility that the numbers may have shifted by one line.
• Roth IRA conversions taxable in 2011 and 2012, entered on the IRA Information Worksheet, are now correctly reflected in modified adjusted gross income on the Roth IRA Contribution Limit Worksheet for purposes of allowing, disallowing, or limiting Roth IRA contributions.
• The foreign country code picklists were updated to match the latest IRS schema requirements.
• An unnecessary error message on Form 4562, Depreciation and Amortization, was removed.

Updating the standard client letter for individual state returns

The original release of the standard client letter paragraph for individual state voucher amounts incorrectly presented the year as an underlined value. The following instructions described how to update this paragraph on your system. It is not necessary to do this for any release after release 2011.010.

• Follow the steps for Approach 1 (below) if you have not edited the standard client letter. or
• Follow the steps for Approach 2 (below) if you have edited the standard client letter.

Approach 1 - Restore the standard client letter for individual state returns:

1. Open a 1040 return.
2. Go to the Tools menu, select Letters, then select Restore Initial Standard Letter.

The program will replace the previous version of the standard client letter for individual state returns with the current version of the standard client letter for individual state returns. Any edits you have made will be replaced.

Approach 2 - Edit your standard client letter for individual state returns:

1. Open a 1040 return.
2. Go to the Tools menu, select Letters, then select Edit Letter.
In the Edit Letter dialog box, select Edit to open the standard client letter.
3. Scroll down the letter to the paragraph stating the amount of your overpayment that will be applied to your <@XXXNxtYear> estimates. That insert code (<@XXXNxtYear>) is underlined.
4. Highlight that insert code and click the U button to remove the underscore.
5. This same error exists in the paragraph that lists the state estimated tax payments farther down in the letter.
6. Go to the File menu and select Save Standard Client Letter.

What's new in ProSeries/1040

For information on what's new in ProSeries, open a 1040 return, go to the Help menu, choose Help Center, then select What's New This Year?

New ProSeries/1040 forms and worksheets

We've added the following forms and worksheets to ProSeries/1040 for the 2011 tax year:

• Amounts on Individual Income Tax Return as E-Filed, for Form 1040X
• Form 1098 Worksheet, Mortgage Interest Statement
• Form 5884-B, New Hire Retention Credit
• Form 5884-B Worksheet, New Hire Retention Credit Worksheet
• Form 8911, Alternative Fuel Vehicle Refueling Property Credit
• Form 8938, Statement of Specified Foreign Financial Assets
• Form 8949, Sales and Other Dispositions of Capital Assets
• Refund Card, Your Prepaid Visa Card: Direct Deposit Enrollment Form
• Refund Card, Your Prepaid Visa Card: What's Next

Tip: For information about changes to existing forms, start or open a Form 1040 return, go to the Help menu, select Help Center, then select What's New This Year?

Obsolete ProSeries/1040 forms and worksheets

We've removed the following obsolete forms and worksheets from ProSeries/1040 for the 2011 tax year:

• Disclosure Statement, Truth-in-Lending Disclosure Statement, Refund anticipation Loan ('RAL')
• Schedule C, Multiple Auto Statement
• Schedule D-1, Continuation Sheet for Schedule D
• Schedule L, Standard Deduction for Certain Filers
• Schedule M, Making Work Pay Credit

Tip: For information about changes to existing forms, start or open a Form 1040 return, go to the Help menu, select Help Center, then select What's New This Year?

Tax legislation issues

For information on tax legislation issues, open a 1040 return, go to the Help menu, choose Help Center, then select What's New This Year?

Electronic filing

Electronic filing functionality is available in this release of ProSeries/1040.

For electronic filing procedures and information, click the EF button on the toolbar to go to the EF Center (also known as the HomeBase Electronic Filing view). The Steps to E-File section on the right side of the EF Center summarizes the steps that you take when you file a client's return(s) electronically. In the Steps to E-File section:

• Click a step to see detailed information in the ProSeries User's Guide.
• Click a button to see more information about electronic filing.

To perform electronic filing functions, select the E-File Now button on the toolbar to e-file the currently open return or go to the EF Center and highlight all of the returns you want to e-file. Next, go to the E-File menu, select Electronic Filing, then select the appropriate command from the Electronic Filing menu.

The commands on the Electronic Filing menu are:

• Convert/Transmit Returns and Extensions
• Receive Acknowledgment Statuses
• Update Acknowledgment Status of Selected Returns
• Electronic Filing Reports
• Correct Duplicate DCNs
• Options

Form 8839 cannot be electronically filed

The Patient Protection and Affordable Care Act (PL 111-148) made changes to the adoption credit, effective for tax years beginning after December 31, 2009. To properly claim the credit, required adoption related documents need to be attached to the return, therefore, returns containing Form 8839 cannot be electronically filed.

Form 5405, page 1 cannot be electronically filed

Returns containing page 1 of Form 5405, Homebuyer Credit cannot be electronically filed. Form 5405 page 2, used to report a partial or total repayment of the credit, can be electronically filed.

Tip: A quick way to select the Convert/Transmit Returns and Extensions command is to click the EF Now button on the toolbar.

Bank Products Reminders

Don't change a Bank Product application after electronically filing a return

If a client is applying for a Refund Transfer (RT), don't change the application from one type of Bank Product to another type after you file the return electronically. If you change the type of Bank Product after you e-file a return, you might not receive a check authorization from Santa Barbara Tax Products Group (SBTPG). If you don't receive a check authorization, you can't print a bank product check for the customer.

Transmit check status information back to Santa Barbara Bank and Trust

If you are offering bank products through Santa Barbara Tax Products Group (SBTPG), it is very important that you transmit the check status information back to SBTPG after you print a bank product check.

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End of ProSeries/1040 ReadMe file