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Author: WendyBG Big gold star, 5000 posts Top Favorite Fools Top Recommended Fools Feste Award Winner! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121095  
Subject: TaxCut 2011 qual. div. mistake Date: 12/19/2012 11:01 PM
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I have used TaxCut (now H&R Block At Home) software for several years.

A Motley Fool member pointed out that this software mistakenly adds in qualified dividends as ordinary income. I looked at my 2011 Form 1040 and sure enough! He is right!

I overpaid the 2011 Federal Income tax based on this mistake. I still haven't checked previous years.

How can I re-submit my 2011 income tax with a recalculated income? What is the correct way to recalculate Form 1040 Line 22 (total income) which currently adds in the Ordinary Dividends but simply ignores Qualified Dividends?

I have the same brand of tax software for 2012, so whatever I do for 2011 will also apply to 2012.

Then I have to check previous years <holding head in hands>.

Thank you!
Wendy
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Author: Wradical Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 117173 of 121095
Subject: Re: TaxCut 2011 qual. div. mistake Date: 12/19/2012 11:18 PM
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A Motley Fool member pointed out that this software mistakenly adds in qualified dividends as ordinary income. I looked at my 2011 Form 1040 and sure enough! He is right!

I overpaid the 2011 Federal Income tax based on this mistake. I still haven't checked previous years.

How can I re-submit my 2011 income tax with a recalculated income? What is the correct way to recalculate Form 1040 Line 22 (total income) which currently adds in the Ordinary Dividends but simply ignores Qualified Dividends?

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I think your first and third paragraphs are contradictory. But either way - all dividends, including qualified dividends, ARE included in your income, down through the point of Taxable Income, which is about 1/3 way down the 2nd page. THEN you go to the "Qualified Dividend and Capital Gain tax calculation" worksheet, where you pull out the qualified dividends and capital gains, and compute the tax (if any)separately for those items.

But for all other purposes, the qualified dividends are like other income items.

Bill

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Author: WendyBG Big gold star, 5000 posts Top Favorite Fools Top Recommended Fools Feste Award Winner! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 117174 of 121095
Subject: Re: TaxCut 2011 qual. div. mistake Date: 12/19/2012 11:46 PM
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When I just re-checked it, the program correctly DID pull out the qualified dividends and capital gains, and compute the tax separately for those items. Whew! Panic averted! I don't have to refile.

Thanks for your help.
Wendy

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