TurboTax Update - Taxable Social Security Calculation Not Correct?

Forum|Forum|5 years ago
March 26, 2021
29 replies
110 views

Hello, I got the desktop update this morning and re-ran the tax file. The taxable social security does not appear to include the unemployment tax relief of $10,200. Line 3 of the SS Benefits Worksheet says to add Form 1040, 1, 2, 2b, 3b, 4b, 5b, 7 and Schedule 1, line 9. Schedule 1 line now includes the $10,300 credit for the tax break. When I added up the amounts in these lines, the SS worksheet total on line 3 does not equal to the added total with a difference of $10,200. Please advise.

cbco7

Level 4

The IRS calculation for taxable Social Security (along with some other items) uses the total unemployment paid amount. In other words, the $10,200 exclusion does not apply to the taxable Social Security calculation. Worksheet instructions need to be updated.

Reference this post:

https://proconnect.intuit.com/community/proseries-tax-discussions/discussion/unemployment-exclusion-and-social-security/00/145352

syoung123Author

Level 6

Thank you. So the instruction on line 3 on the social security benefits worksheet is not correct, and I need to exclude the $10,200 to determine the amount of line 3 (which will be higher by $10,200) then.

DianeW777

Level 15

Yes. You do NOT exclude the portion of the unemployment that is allowed to be excluded for personal income tax. It is NOT allowed to be excluded when determining your taxable social security amount.

This IRS page will provide specific details about this situation. New Exclusion of Unemployment Benefits

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100392

Level 2

IRS says turbotax calculation on Social Security is not correct. What do I do now. I have ordered a transcript of my return

jmosner

Level 2

Did the IRS or Turbotax give you any additional information such as why the social security calculation was incorrect? Did it have to do with unemployment? If so, was it because Turbotax included the unemployment received even though on the worksheet for IRS it did not?

tiutniwantsdata

Level 2

I'm doing 2022 taxes (today is 15 April 2023). The taxable social security calculator for 1040 form is seriously screwed up IMO. It doubles the SS amount received. It is wholly inconsistent with the IRS pdf form available here:

https://img1.wsimg.com/blobby/go/35e70200-9d7d-4401-b45f-7c8d57460c76/downloads/Social%20Security%20Taxable%20Benefits%20Worksheet%20202.pdf?ver=[phone number removed]4

Assuming I'm correct, the above is a serious error in the 2022 1040 Turbotax software. What the TT calculator does is DOUBLE the SS amount before figuring the calculable amount. This is ridiculous, and as I note, not what the IRS available worksheet does.

DoninGA

Level 15

@tiutniwantsdata Where are you seeing a doubled SS benefit amount?

What is shown on the Form 1040 Line 6a?

If using the TurboTax online editions -

Click on Tax Tools on the left side of the online program screen. Click on Tools. Click on View Tax Summary. Click on Preview my 1040 on the left side of the screen.

tiutniwantsdata

Level 2

The "Social Security Benefits Worksheet" in Turbo Tax directs that the number in box 5 of SSA-1099 ("Total net benefits from Box 5 of all SSA-1099 forms") be put on BOTH line A and line F.

Line F is an exact repeat of Line A. If line F is supposed to be a total of lines A through E, it does NOT say that, and the worksheet does not automatically bring the number down. This is really poor form design.

Moreover, even when I leave line F empty, the rest of the worksheet comes up with a number $2,175 higher as taxable SS income than the IRS worksheet I downloaded ("Social Security Taxable Benefits Worksheet (2022)").

This misleading if not outright incompetent form work makes me question the accuracy of everything else in the software. I have been doing my own taxes for years (I'm an attorney, but I don't practice tax law [god forbid]); I have been using this software since it was MacInTax, and I find it has become increasing difficult to use. The cross linkages are less intuitive and mistakes like the above are easy to make and miss.