Hi @ErnieS0 ,
Thank you for a detailed response. I calculated the tax correction after the payback based on the method that you suggested and to see if I can claim any credit. While there is a tax excess paid here, since the Company will recoup back the excess part and rest of the reductions being linear, I don't see really see a net change in my taxes after my payback + company claiming their tax portion from IRS. So, I will probably not file an amendment here. I'm from State of Texas, there is no State tax filing - so one less step.
The only non-linear part here is the social security wage cap of $137,700 and corresponding tax of $8537 for year 2020. Even after repayment, net taxable wage does not go below this mark and if company claims a recoup on the part of social security tax they paid, then that will result in a deficit on my side to the IRS (IRS will then see an adjusted social security tax of ($8537 - X), where X is the company recoup). I'm not sure how to let IRS know when and whether such a deficit will happen. But in any case, any changes/event to my tax filing should generate a notice from IRS/company and hopefully there will be an instruction to move forward.
Thank you
