I already filed my 2024 return. I just received a retroactive lump sum due to the Social Security Fairness Act. How do I handle this and can Turbo Tax help?

[DawnC · Accepted solution]

If you received the income in 2025, it will be reported on your 2025 tax return, the one you file next year.    You will have the option to use the lump sum method to report the income.   

[Edited 03/26/25 | 9:01 AM - PST]  @rugela 

[Somerset1962]

I did too but the income was given to you in 2025. It will appear on your SSA-1099 for 2025.  I see no need to amend your 2024 return. The amount is retroactive but the payment was made in. 2025.  

[Somerset1962]

Dawn, are you sure that is the right answer.  Aren’t we taxed on the income when it is received not when it is earned?  These retroactive payments went out to over a million folks beginning in March.  They are to reimburse us for the unfair law that reduced SS payments to people who worked both in the private and the public sector.  We now receive the fair amount we should have always received.  For me that has been 10 years of reduced SS income. However the congress approved only one year of retroactive payments.  These lump sum payments will show up on our 2025 SSA-1099.  

[DawnC]

Yes, if you received the income in 2025, it will be reported on next year's return.  @Somerset1962