This is for the same employer which happens to be me. I own my own business. It is true that TurboTax says I overpaid because of rounding errors. With a total gross salary of $61,877.40, Turbotax calculated at 6.2% a Social Security of $3836.40 or $3836 rounded to the dollar. My payroll is done on a weekly basis. So each gross wage per week is $61,877.40/52=$1,189.95. If you figure 6.2% at this weekly rate, the amount that is taken out per week for Social Security is $73.78. At the end of the year when W-2's are calculated, the amount of Social Security is $73.78 x 52 weeks = $3,836.56 or $3,837 rounded to the dollar. As you can see it is $1 more than the calculation made for the total gross wage by Turbotax. As the employer, when I make my withholding payments to the IRS on a quarterly basis on Form 941, there is a "quarterly fraction of cents" adjustment that can be made to adjust for these rounding errors. It is usually not more than a penny or two. But the IRS expects and allows for this penny fraction adjustments.
So yes, looking at the total wages at a whole, I overpaid by $1 or if we want to look at cents, I overpaid by 16 cents because of rounding errors. This is way too much trouble to do W-2 corrections for only a 16 cent difference. Can I just ignore this $1 (or this rounding error) since even the IRS knows there is going to be fraction of cents adjustments? Also, error must be new because I have been using Turbotax for years and it never came up before and the wage has been the same for a couple years.
