I had to repay an amount for disability benefits that was included in last years income. Where do I file the overpayment?

Forum|Forum|7 years ago
June 7, 2019
6 replies
38 views

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KO21

Level 2

How does this answer change if the payback happened in the SAME year the income was received (payback exceeds $5K)?

Anonymous

What if the disability payments were received in 2019 and repaid in early 2020 prior to tax filing?

Must the taxpayer pay the taxes for 2019 and then claim a repayment on the 2020 return?

Is there a method in which the taxpayer can deduct the 2019 payments on the 2019 return given that they were repaid in early 2020 before filing the 2019 return?

Thank you.

DianeC958

Level 12

Yes, you must claim and pay the tax for the amount you received in 2019 and the deduct the repayment made in 2020.

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Anonymous

DianeC958 - Thank you very much for your response. Was hoping there was another way to handle this, but your answer is very much appreciated.

Snnnels0117

Level 2

Pre 2019 ammount-541.41$ potential2019 tax deduction 541.41$ pre-2019 amt.× taxability of claim 100%

JamesG1

Level 15

Repayments are discussed in IRS publication 525 pages 34 & 35.

You talk about amounts of repayments of less than $3,000. Note this statement in the right hand column of page 34.

"For tax years beginning after 2017, you can no longer claim any miscellaneous itemized deductions, so if the amount repaid was $3,000 or less, you are not able to deduct it from your income in the year you repaid it."

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bxd76

Level 2

I know this is an old thread but hoping someone can clarify the response from @JamesG1 . He writes:

"so if the amount repaid was $3,000 or less..."

What if the repayment is significantly greater than $3,000? I received disability payments in 2020, covering years 2019 and 2020. Then later had to repay some of that in 2020, and now being asked to repay even more of that 2019/2020 money, in March 2021. Thank you.

janice_1

Level 2

I repaid disability benefits that were overpaid to me because of a coding error back to 2017, 2018, 2019 & 2020. The company issued amended T4A's for the amounts I should of received but now I owe a lot of money due to no fault of my own. The company is insisting that a credit will be issued for the 2022 tax year for the repayment amounts. Should I not be able to use those credits now in an adjustment in order to not to owe this huge bill to CRA?

If I cannot use the credits for prior years, should the company not of sent out the amended T4A's until the 2022 tax year as well?

Thank you for your help.

Dr416

Level 2

I know this goes on itemized deductions, but I am unable to get it to enter on line 16. Can you help?

AmyC

Level 15

If you repaid more than $3,000, you can claim the repayment. Here are your options and how to enter it, see Turbo Tax article What is a Claim of Right Repayment.

The repayment only helps on deductions if you are itemizing. Most people find the credit in their favor. The steps are included in the article above.

@Dr416

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