Voluntary Plan for Disability Insurance (VPDI) is not deductible on the federal tax return (Schedule A (Form 1040) Itemized Deductions) per Rev. Rul. 81-194. Entering the VPDI amount on the screen titled Wages-W-2-Other Information will transfer the total amount to the Excess SDI/VPDI Withheld Worksheet. If there is excess withheld, it will flow to Line 74 of Form 540 or Line 84 of Form 540NR.
To enter or remove VPDI:
- From within your TaxAct return (Online or Desktop), click Federal. On smaller devices, click in the upper left-hand corner, then click Federal.
- Click Wages and Salaries in the Federal Quick Q&A Topics menu to expand, then click Wage income reported on Form W-2.
- Click + Add Form W-2 to create a new copy of the form or click Edit to review a form already created.
- Continue with the interview process to enter all of the appropriate information.
- On the screen titled W-2: Enter Taxpayer's/Spouse's information, check Yes, there is something in Box 14, then click Continue.
- On the screen titled W-2: Enter Taxpayer's/Spouse's information from Box 14, enter the Voluntary plan for disability insurance contributions (CA VPDI) amount, then click Continue.