2023 Form SSA-1099 and adjustments made to this 2023 income in 2024

[Xtermy]

Hello,

I have two questions regarding Social Security Old income:

1) I applied for Social Security Old Age benefits in July 2023. However, I continued to work afterwards. Therefore, around March 2024, after the SSA got and consolidated the earnings statements from my employer for 2023, they recalculated how much benefits I am entitled to receive per month. As a result, my monthly benefits were permanently increased going forward. In addition, I also received a retroactive adjustment to the previously made payments, in the form of a one-time lump sum payment of the amount that should've been paid to me in 2023 and in the beginning of 2024.

So, my first question is whether I need to report this one-time retroactive payment on my 2023 tax return (since this is the period that the money was mostly retroactively paid for), or for 2024 (when the money was actually paid and consequently entered my bank account). The 2023 Form 1099-SSA doesn't list this amount, and I haven't received an amended form for 2023, so I'm assuming that this amount will be included on the 2024 form, but I wanted to make sure.

2) My spouse didn’t work enough in the United States in order to qualify for her own Old Age benefits. However, she is eligible for 50% of my own monthly benefits, since we have been married for over 10 years. Her enrollment process for these benefits was only completed in 2024. However, after she signed up, the SSA retroactively paid her the 50% for every month, going back to when I first started receiving my own benefits, in July 2023. And, just like my own retroactive one-time lump sum payment, these retroactive benefits were also paid in 2024, and therefore weren’t included on the 2023 Form 1099-SSA. So, I’d also want to make sure whether these payments should only be reported on the 2024 return?

Thank you very much in advance.

[NCperson · Accepted solution]

@Xtermy everything is to be reported in 2024.  the retroactive payment (from 2023) will be listed separately on the bottom of form 1099-SSA when you receive it in January. 

as you enter the form next year, one of the questions TT will ask if whether there is a lump-sum payment included.  just watch for it and answer as appropriate.  (hint: have your 2023 tax return handy as TT will as questions about that prior year return) 

[Xtermy]

Many thanks to you! This answers both of my questions perfectly.

[MARINAABRA]

The Lump Sum in Turbo Tax cannot exceed $2, 023 according to Turbo Tax.

Is this an error in Turbo Tax??

Marina abra

[cdono524]

I believe I forgot to do my 2023 state and federal taxes

[DoninGA]

---

@cdono524 wrote:

I believe I forgot to do my 2023 state and federal taxes

---

Go to this IRS website to see if there is a 2023 transcript - https://www.irs.gov/individuals/get-transcript

To complete and file a 2023 tax return using TurboTax you would need to purchase, download and install on a personal computer one of the 2023 desktop editions from this website - https://turbotax.intuit.com/personal-taxes/past-years-products/

A 2023 tax return can only be printed and mailed, it cannot be e-filed using TurboTax.

[DianeW777]

No, the social security lump sum is not limited.  Enter exactly what you received for each year. 

You can use the Social Security lump-sum action to reduce the amount of your taxable social security, even possibly to zero.

• What is a Lump-Sum Social Security Payment?

The lump-sum election has always worked correctly in TurboTax. Have all tax returns available for each year included in the lump sum payment (shown on your SSA-1099).

This can be handled on your tax return for 2024. The Form SSA-1099 should show a total amount in box 5, and then the amount that is designated for each year in box 3. Worksheet 4 is included after Worksheet 2 is completed for each year.

Be sure to select "lump-sum" method of reporting in this situation which is all done on the tax return for the year of receipt of the benefits.  Enter the appropriate amounts for each year when you start that section of your return.   Continue to add each year for all years listed in box 3. There is no amendment required.

1. Open your TurboTax Return > Search (upper right) > type ssa1099 > Click the Jump to.... Link
2. Select Yes you received benefits > Complete your SSA-1099 > Continue > Yes I received at least one lump sum payment for 2023 or earlier > Continue
3. Type a year from your SSA-1099 > Enter the amount received for that year > Continue
4. If you received a Form SSA-1099 for the earlier year enter the box 5 amount, if not enter zero or leave it blank > Continue
5. Enter the filing status for the earlier year > Continue > Select whether you lived with a spouse in the earlier year > Continue >
6. Enter the information from the earlier year return > Continue > Add another lump sum payment (another year from box 3) if applicable or Click Done
7. Continue to follow the screens until you are back at the Income Summary page

Also enter a zero if your Social Security benefits weren't taxable or there were none in the earlier year(s) (such as for a spouse). If you are using the TurboTax Desktop version review the Lump-Sum Social Security Worksheet in Forms.  You can also review 'Earlier Year Lump-Sum Worksheet' for each year.

@MARINAABRA