North Carolina 2010: Deduction Related to Self-Employment Tax May Be Incorrect for Certain Customers
A new federal tax law changed the calculation for the "one-half of self-employment tax" deduction (Form 1040, line 27.) In April, 2011, North Carolina agreed to conform to this new law. Previously, TurboTax included the difference between the federal and North Carolina deduction on Form D-400, line 52.
This issue was fixed on May 10, 2011.
How to tell if you're impacted
You are affected if:
- You filed a 2010 North Carolina tax return prior to May 10, 2011 AND
- Your federal return included a “one-half of self-employment tax” deduction (Form 1040, line 27) AND
- Your federal return also included a “self-employed health insurance deduction” (Form 1040, line 29.) AND
- Your North Carolina tax return, Form D400, line 52 includes the wording "SELF EMPLOYMENT TAX ADJUSTMENT DUE TO SELF EMPLOYED HEALTH DEDUCTION, SBJA." (See the "Other Additions and Other Deductions Statement" for details)
If you are affected, you may have underpaid your North Carolina tax. If so, you will need to amend your North Carolina tax return.
If you need to contact us, please use the phone number in the email from TurboTax and tell the representative you’re calling about the North Carolina: Self-Employment Tax Deduction.
Solution
Let us do the work for you. We highly recommend this.
- Please download and print this Authorization Form.
- Complete the form and fax it to us at the number printed at the top of the form.
- Note: After we receive your completed authorization form, please allow up to 15 days to amend your return.
- You can print, sign and mail the corrected return to North Carolina.
Or you can make the corrections yourself. However, the amend process can be complex.
- To do it yourself, please follow these step-by-step instructions.
- After you make the changes to your tax return, you will need to mail a copy to North Carolina.
- If you need assistance, call us at the phone number in the TurboTax email.
