Schedule 3 Line 10 question... can this be right?

[Sojourner]

I paid $5,000 to the IRS in April 2024 along with my request for an extension, since this was the "safe" amount I calculated I needed to pay to avoid underpayment penalties on my 2023 income taxes. This turned out to be exactly correct, as I ended up owing $0 in October when I filed.

Now, while working on my taxes for 2024, H&R Block is telling me to enter that $5,000 that I paid last April on line 10 of Schedule 3. When I do that, it increases my refund by $5,000. Can that be right? On first blush, it doesn't make any sense to me because that $5,000 was money I paid to cover my 2023 tax bill. Why would any payments I made to cover my 2023 federal taxes be credited back to me simply because I paid them in April 2024 along with a request for an extension? I feel like I'm missing something simple and obvious here, but I cannot grasp how this could be. Please help me understand this!

 

[youbet]

When you entered the $5k into the program, what question were you answering?

 

[Sojourner]

When you entered the $5k into the program, what question were you answering?

On the page titled "Payment with Extension", it says: Enter any payments that you made with your request for an extension (Form 4868). And there is a box to enter the amount with the words "Payments with Form 4868" next to it. When I saw that, I went back and checked to see that I did, indeed, make a $5,000 payment when I filed Form 4868 last April. So it does seem that I'm answering the question correctly, but I'm just baffled at why that money would now be credited back to me when filing my 2024 tax return.

 

[copyright1997reloaded]

I paid $5,000 to the IRS in April 2024 along with my request for an extension, since this was the "safe" amount I calculated I needed to pay to avoid underpayment penalties on my 2023 income taxes. This turned out to be exactly correct, as I ended up owing $0 in October when I filed.

Now, while working on my taxes for 2024, H&R Block is telling me to enter that $5,000 that I paid last April on line 10 of Schedule 3. When I do that, it increases my refund by $5,000. Can that be right? On first blush, it doesn't make any sense to me because that $5,000 was money I paid to cover my 2023 tax bill. Why would any payments I made to cover my 2023 federal taxes be credited back to me simply because I paid them in April 2024 along with a request for an extension? I feel like I'm missing something simple and obvious here, but I cannot grasp how this could be. Please help me understand this!

Are you referring to a) or b) or something else?

 

[Sojourner]

Are you referring to a) or b) or something else?

I'm referring to your b) screenshot, "Amount paid with a 2024 extension". If you tick that checkbox, then it will ask you to enter your payment(s) with Form 4848 on a following screen, which looks like this.

 

[TickTock]

OP,

It doesn't make sense to me either, and I've found that when that happens I've usually mis-interpreted some part of the tax code / IRS instructions. Although I would not call either of those simple nor obvious...

 

[UpQuark]

"Amount paid with a 2024 extension"

Maybe a "2024 extension" means for tax year 2024 and you are inputting the amount you paid for the tax year 2023 extension (filed in 2024)?

 

[SecretlyFI]

Maybe a "2024 extension" means for tax year 2024 and you are inputting the amount you paid for the tax year 2023 extension (filed in 2024)?

+1. I think it definitely means this, especially since the heading over those 4 choices indicates payments made "for 2024" (not "in 2024"). I don't think you should have to enter any payments of 2023 taxes when you're completing your 2024 return, in 2025. Any over/under for 2023 was settled when you finalized your 2023 return.

 

[SecondCor521]

I paid $5,000 to the IRS in April 2024 along with my request for an extension, since this was the "safe" amount I calculated I needed to pay to avoid underpayment penalties on my 2023 income taxes. This turned out to be exactly correct, as I ended up owing $0 in October when I filed.

Now, while working on my taxes for 2024, H&R Block is telling me to enter that $5,000 that I paid last April on line 10 of Schedule 3. When I do that, it increases my refund by $5,000. Can that be right? On first blush, it doesn't make any sense to me because that $5,000 was money I paid to cover my 2023 tax bill. Why would any payments I made to cover my 2023 federal taxes be credited back to me simply because I paid them in April 2024 along with a request for an extension? I feel like I'm missing something simple and obvious here, but I cannot grasp how this could be. Please help me understand this!

The instructions don't make it clear, but you should *not* put that $5000 payment on Schedule 3 line 10 of your 2024 return. You should have put it on Schedule 3 line 10 of your 2023 return.

 

[copyright1997reloaded]

Maybe a "2024 extension" means for tax year 2024 and you are inputting the amount you paid for the tax year 2023 extension (filed in 2024)?

Yes, that is what it means.
ETA: I think. I would have to look back at taxes where I did an extension.

 

[jebmke]

Maybe a "2024 extension" means for tax year 2024 and you are inputting the amount you paid for the tax year 2023 extension (filed in 2024)?

That's what it means

 

[Sojourner]

Thanks for all the helpful responses, everyone Makes perfect sense now. Definitely will NOT be putting $5,000 on line 10 of Schedule 3 for 2024!