Has anyone else run into this? I entered all my data into H&R Block software and got to the final steps of preparing to file electronically. I entered all my checking account information, scheduled the date I would pay my taxes due to the IRS and then clicked on the final step which was to do the actual filing. To my great surprise, the software came back with a "Unfortunately, you can?t e-file this year...This return cannot be electronically filed because you have a line entry on Schedule B for previously reported bond interest adjustment. You?ll have to print and mail your 2019 return instead".
What they are referencing is that I am using the accrual method of EE
Savings Bond interest reporting, which is allowed under IRS rules. That
means I have EE savings bonds which I have held since 1992 and years ago
decided to pay the tax on the accrued interest to that point. Every year
since then I have paid tax on the interest earned in that year, even though
I still have the bonds. In 2019 I cashed a couple of bonds and the IRS
sent me a 1099 that included all the interest that had accrued since 1992,
much of which I had already paid. So again, following IRS rules, I reported
the 1099 amount on Schedule B but then deducted the amount that I had
already paid. The H&R Block software understood what I was doing and gave
me a correctly formatted Schedule B. Yet despite creating the Schedule B
properly, the software still wouldn't let me file electronically.
So I pursued this issue through H&R Block Support, and they eventually sent
me this message: We have gotten word back from our Development department
and they are saying "The program is working as expected. The Schedule B US
Savings Bonds adjustment for interest previously reported is required to be
paper filed so the IRS can examine the return before accepting the return as
properly filed. ".
Does this make sense to anyone? I have looked through various IRS
publications but can't see anything anywhere that says they won't accept an
electronic filing if there is a savings bond adjustment on Schedule B. I've
asked the H&R Support people to send me a reference to support their
statement to me, but have not heard from them.
At this point, I would be happy to file through another company like TaxAct
or Turbo Tax, but don't want to run into this same problem. I?m basically
trying to figure out if this problem is unique to H&R Block or if is an
actual IRS requirement. Has anyone heard of the IRS refusing to accept
electronic filing in this situation?
- posted 1 month ago