With Betterment, you can automatically import your tax information into TurboTax. The soonest you can start importing is Feb. 15, 2022. Note that we do not currently support integration with Quicken.
If you need your tax forms, you can download them in your account. All tax forms will be ready to download by Feb. 15, 2022.
Note: Software providers may have different versions of their tax preparation software, such as online versus desktop, and not all versions will support automatic import of brokerage data. Betterment cannot control which versions have automatic import enabled, so please ensure you review your options prior to software purchase if you would like to use automatic import features.
Importing With TurboTax
Please note that while Betterment has provided the tax information in the format specified by the tax preparation software providers, we do not manage the software itself. If you are experiencing issues with your tax import, we encourage you to contact the software providers directly. To connect with a TurboTax Expert who is specially trained, please contact TurboTax directly.
Use an App Password when importing.
To import with TurboTax, you’ll need to use the App Password generated within your Betterment account instead of your standard Betterment password. You can generate an App Password by logging in on a web browser, heading to “Security,” and clicking on “Generate a new App Password.”
As a reminder, you need to set up a new app password for every import (typically each tax season).
TurboTax may round your data—which could lead to misreporting wash sales.
In some cases, TurboTax software may round the data imported from Betterment. This is not something Betterment can control, so please take care to verify the data import with the information provided on your Betterment tax forms. For more information on rounding, please see the IRS instructions for Form 8949.
Rounding done by TurboTax may cause some wash sales to be reported incorrectly. If a transaction has a wash sale that is less than $0.50, the TurboTax software will round the amount Betterment provides to $0 and will override the wash sale amount provided by Betterment with an amount equal to the difference between the sale proceeds and cost basis. This may result in an incorrect amount of wash sale for the transaction. Betterment cannot control this process, so please ensure you check all of your individual transactions against the 1099-B provided by Betterment to verify that your tax return is correct.
I can’t submit my taxes because TurboTax says I have several $0 wash sales and won’t accept them. What can I do about this?
TurboTax has provided solutions for this on their website’s Discussion section. We have summarized the instructions for your convenience, but please direct any questions you have about this process directly to TurboTax. Betterment is not a tax advisor.
- If the amount of rounded transactions is fairly low, you can manually correct each of the $0 rounded values to the correct value.
- If the amount of transactions is too high to manually correct each one, you can take the following steps to resolve:
- 1. In “Wages and income” section, go to the the “Stocks, Mutual Funds, Bonds, Other” to delete the import (use the trashcan icon to do this)
- 2. Select “add more sales”
- 3. Select “I’ll type it myself” instead of importing
- 4. Turbotax asks questions about the characteristics of the investments. For Betterment accounts, most commonly,
- The investments were not employee stock
- There were more than a few sales (4+)
- They did not include other types of investments such as collectibles
- They were not acquired as gift/inherited property.
- However, you should review your specific situation to confirm that all of those statements are true.
-
- 5. Type in the summary totals separately for your short-term and long-term realized gains/losses, taken from your 1099-B/DIV (or 1099-B) which you can download in your Betterment account.
- 6. Attach a copy of your 1099-B in pdf format. This strategy typically allows you to avoid physically mailing your 1099-B to the IRS.
TurboTax will ask you about any dividends that are exempt from interest.
Betterment invests in a variety of state municipal bonds. If you are importing a 1099-DIV and Box 11 (Exempt Interest Dividends) is not $0, TurboTax will show you a screen which asks: “Choose the state where your tax-exempt dividends came from.” From the dropdown, you could select “More Than One State.” You could also consult the tax form detail and the fund company websites to determine the state(s) associated with your tax-exempt dividends. Instructions on how to obtain this information on our new Supplemental Tax Statement may be found here.
Please note that while most customers will receive a Supplemental Tax Statement, a small subset of customers will not, due to various holdings that are not generally included in our main portfolio strategies here at Betterment.
If you have more than 1,500 lines of transactions, you might not be able to import via the online version of TurboTax.
Certain versions of tax software limit the number of transaction lines they support for automatic upload. This varies from provider to provider.
For example, the online version of TurboTax has a limit of 1,500 transaction lines, but the desktop version has a 2,500 limit.
If you are unable to automatically import your tax forms into your tax software, the IRS allows you to report the summary information on your electronic tax return and send a paper copy of your statement with Form 8453 to the IRS after your tax return has been accepted. If you report your Betterment transactions on Form 8453, you should check the box that says “Form 8949, Sales and Other Dispositions of Capital Assets (or a statement with the same information), if you elect not to report your transactions electronically on Form 8949.”
Importing Joint Accounts
It is fairly common for people filing taxes together to have both individual accounts and joint accounts at Betterment. Each joint account holder will receive their own copy of the joint account 1099 forms in their Betterment account for tax filing, if applicable for their account. This can lead to duplicate tax forms being imported if appropriate steps are not taken.
For this reason, joint account holders filing together will need to either prevent the duplicate joint account tax forms from importing, or delete any duplicate joint account tax forms that do get imported when they both import their tax forms into tax-filing software. This will avoid double reporting the activity of joint accounts.
- Prevent: When importing tax forms, you will be able to deselect certain tax forms that you do not want to import. You should deselect any joint account 1099 forms that you have already imported.
- Delete: If you do not prevent a duplicate form from being imported, you can delete the duplicate form from within your tax filing software directly.
Instructions for Importing: Online Version of TurboTax
When you import your tax information into TurboTax, you will see a screen listing each of the documents available for import, with the name of the corresponding Betterment account next to each. Make sure to check or uncheck the documents applicable to the tax return you are working on.
From the Import Summary screen, select “Add Other Documents”. On the following screen, type “Betterment” into the “Import from my bank or brokerage” field. Select “Betterment” from the list below and click “Continue” to import.
If you experience technical issues with the online version of TurboTax, we’ve heard from a few customers that signing into the online version of Turbotax Premier, transferring your Betterment tax forms there, saving the tax return file and opening it in the Desktop version (with all the data added) will work. However, these aren't official troubleshooting steps from TurboTax.
If none of this works, it is best to reach out to Turbo Tax support directly.
Instructions for Importing: Desktop Version of TurboTax
In addition to the online import method detailed above, you can also select “Import” from the File menu and click “From Financial Institution.”
On the following screen, type “Betterment” into the “Enter financial institution name here” field. Select “Betterment” from the list below and click “Continue” to import.
Customers running into technical difficulties should take the following troubleshooting steps before contacting TurboTax for additional support:
- Temporarily disable any firewall, spyware blockers, or virus protection on your computer;
- Clear the cache and history from your web browser;
- Restart your computer, then try importing your tax forms again.
According to TurboTax, if your firewall blocks their software's internet access, then you won't be able to e-file.
While these steps have worked with some of our customers, please note these are not official steps that Intuit has publicly confirmed. While we want to protect your security, turning off firewalls can make your system more vulnerable to external interferences. We do recommend turning your firewall back on after uploading your tax forms.
TurboTax, Mint, and Quicken are registered trademarks of Intuit, Inc.
Third party tax softwares mentioned are offered as a matter of convenience and are not intended to imply that Betterment or its authors endorse, sponsor, promote, and/or are affiliated with the owners of or participants in those sites, or endorses any information contained on those sites, unless expressly stated otherwise. If you use third party tax software, you'll be subject to the applicable terms and conditions of use for those products, including a separate privacy policy. You should read and understand all applicable terms for these tax softwares before using them.
Please note that Betterment is not a tax advisor and the information provided should not be construed as tax advice, but should be used for informational purposes only. Please consult a qualified tax professional or the IRS to determine the rules that apply to your individual tax situation.