My employer, a USG agency, provides a student loan repayment incentive for which they send funds directly to my loan provider. In 2018, they sent more to the loan provider than I owed in loans. The loan provider refunded the overpayment to the USG. Meanwhile, my employer had withheld taxes based on the amount of the original (overpaid) incentive, not the adjusted post-refund amount. They issued W-2 that showed the initial (overpaid) incentive amount as part of my income and the taxes withheld on that basis. After the tax deadline, they issued a corrected W-2 that reflected the correct (post-refund) incentive amount and what the corresponding lower taxes should be. I got an extension and am now preparing to file my return. Do I file using the corrected W-2. And how do I recover the over-withheld taxes?
