Federal Module -- §280A Home Office -- Wrong tax treatment

Under IRC §280A and IRS Publication 587, a self-employed taxpayer using the simplified method may deduct home office expenses when the business shows a net profit; TurboTax's logic incorrectly evaluated the profit as zero or negative despite the taxpayer reporting positive profit. Additionally, a separate user reported TurboTax calculated federal income tax of $8,094 on $86,031 of taxable income for a married filing jointly return, while the official 2025 IRS Tax Table (Form 1040 Instructions, p. 78) shows the correct tax as $9,846—a $1,752 understatement, likely because TurboTax applied an alternative calculation method (e.g., Qualified Dividends worksheet) without the user's awareness.

A self-employed small business owner could lose a legitimate home office deduction they are entitled to, or conversely understate their federal tax liability by up to $1,752 due to incorrect tax table application, risking an IRS underpayment notice, accuracy-related penalties under IRC §6662, and potential interest charges.