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Trace99
Level 1

How does an employer recoup Social security over payment made on behalf of an employee?

Suppose the employee had changed employers during 2021. 
And suppose the employee & employer #1 maxed out the Social security contributions for 2021.

Now Employer #2 must also withhold 6.2% Social security from employee paycheck and pay the same amount on behalf of that employee.
But that is all overpayment for 2021.

I know that the employee can request a Social Security refund for overpayment when they file their taxes.

But how does employer #2 recoup their part of the Social security overpayment made on behalf of the employee?

(I use TurboTax Business)

1 Best answer

Accepted Solutions
Critter-3
Level 15

How does an employer recoup Social security over payment made on behalf of an employee?

They don't recoup anything ... the limit is on the employee's portion only.  If there is excess paid by the employee they get a credit on their tax return  but there is no such relief for the employer. 

View solution in original post

6 Replies
Critter-3
Level 15

How does an employer recoup Social security over payment made on behalf of an employee?

They don't recoup anything ... the limit is on the employee's portion only.  If there is excess paid by the employee they get a credit on their tax return  but there is no such relief for the employer. 

View solution in original post

Trace99
Level 1

How does an employer recoup Social security over payment made on behalf of an employee?

Thank you. Sorry to hear that.

I guess that means that if an employee worked for say 3 different employers in 2021 and earned over $142,800 at each job. The government actually netted $8,853.60 from the employee (6.2% of $142,800)

And triple that from all his employers combined $8,853.60 * 3 = $26,560.80!

Is that right?

Critter-3
Level 15

How does an employer recoup Social security over payment made on behalf of an employee?

Sadly it is correct.   

Trace99
Level 1

How does an employer recoup Social security over payment made on behalf of an employee?

Thank you.

macuser_22
Level 15

How does an employer recoup Social security over payment made on behalf of an employee?

Or look at it this way.   Had the employee only worked for one employer then  the employer would still have to pay the SS tax to the gov.     Just becuse there were several employers and each employer did not them-self exceed the maximum withholding then that employer owes the gov. based on what that employer paid.    

 

The maximum SS withholding for the year is the limit that an employee must pay so the employee can get a refund form the gov. but each employer cannot NOT pay their part just because the employee worked for someone else.

**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
Trace99
Level 1

How does an employer recoup Social security over payment made on behalf of an employee?

Thank you

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