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I entered a SSA-1099 reflecting a benefit received from my parents death. Federal Refund then decreased by more than the amount listed in box 5 on the form.

When declaring the amount received from a parent's Social Security death, the Federal Refund that TT calculates decreases by more than the amount that we received.  In other words, it appears that the SS benefit actually cost us ~ $80 ($280 benefit, but $360 tax increase).  Does this sound right, or am I entering this incorrectly?
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1 Reply
ColeenD3
Expert Alumni

I entered a SSA-1099 reflecting a benefit received from my parents death. Federal Refund then decreased by more than the amount listed in box 5 on the form.

It is hard to say why without seeing the rest of the return to know why. Sometimes an addition to income reduces a credit based on the previous amount of income. The best thing to do is to remove the amounts, examine the 1040, and then re-enter to see exactly why and where the change occurred.

 

 

According to the IRS:

When a taxpayer dies, a new taxpaying entity – the taxpayer's estate – is born to make sure no taxable income falls through the cracks. Income is taxed either on the taxpayer's final return, on the return of the beneficiary who acquires the right to receive the income, or if the estate receives $600 or more of income, on the estate's income tax return.

 

In order to preview your return, please follow the instructions below:

  1. Open your return.
  2. Click on Tax Tools.
  3. Click on Tools.
  4. Click on View Tax Summary under Other helpful links.
  5. Click on Preview my 1040.

 

 

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