How to get the refund of employer portions of excess social security taxes? I do see answers for employee portion of social security taxes only.

[Critter-3]

@dmertz 

Thanks for putting it so directly.  

[Srini991]

 @dmertz  and @Critter-3 

Do you both agree that total payroll taxes should be 12.4%?

According to IRS website.

https://www.irs.gov/taxtopics/tc751#:~:text=The%20current%20tax%20rate%20for,employee%2C%20or%202.9%....

In my case, it is very clearly crossed  total 12.4% of Social security tax.  IRS is over collecting taxes here.

Here, my maths is very clear.

You both are creating consensus to make maths wrong. 

[Critter-3]

Yes ... read the 941 & the 941 instructions (posted earlier)... EACH employer will withhold 6.2 from the employee + 6.2 for the employer match until that employee has reached that year's maximum amount.  At that time the SS withholding & employer portion stops for that employee for the rest of the year.  

Your business did not pay you the max in SS wages so the employer is required to continue to withhold and pay until you hit that max with them ... your having another employer is immaterial to this calculation.  I see where you think this is unfair because it is unfair however that is how the rules were written.   

Now if your business withheld/paid in too much because your business failed to recognize the limit and actually paid in an excess then and only then can you amend the 941 to get the excess paid in for the employer but you did not indicate that your business paid you more than $142,800 in wages in 2021 or $147,000 in 2022 but if they did then by all means amend the 941.  However if the limit was exceeded by the combination of more than one employer you have no basis to amend. 

[Critter-3]

Do you both agree that total payroll taxes should be 12.4%?   YES  ... 6.2% for the employee and 6.2% for the employer. 

According to IRS website.

https://www.irs.gov/taxtopics/tc751#:~:text=The%20current%20tax%20rate%20for,employee%2C%20or%202.9%....   Keep reading ... the limits section.   

In my case, it is very clearly crossed  total 12.4% of Social security tax.  IRS is over collecting taxes here.

Here, my maths is very clear.   Yes ... and as an employee (who only pays 1/2 of that 12.4% tax)  you can get an excess that was withheld from your paychecks on the form 1040 if you had more than one employer during the year.  If you only had one employer during the year and they made the error then they need to correct it and refund your excess withholding to you.  However each of the individual employers did not overpay  ... each employer withholding/payment  is calculated independently of any other employer the employee may have during the year.   There is no way arround this fact and no solution to the inequity of it.  

[dmertz]

"Do you both agree that total payroll taxes should be 12.4%?"

12.4% of what?  12.4% of $142,800 of your total compensation for 2021?  No, there is no such limit.

For 2021, the total employee portion of Social Security taxes is limited to 6.2% of up to $142,800 of total compensation.  The employer portion is separately limited to 6.2% of up to $142,800 of compensation earned at each separate employer.  There is no combined limit for your employers.

12.4% is mentioned nowhere in the tax code (except for the self-employed, which you are not).  The tax code specifies 6.2% for each individual (26 USC § 3101(a)) and 6.2% for each employer (26 USC § 3111(a)) .  The amount that one of your employers must pay has nothing to do with what what the other of your employers must pay.

[Srini991]

Ok Friends. Everything is grey. I have used Turbotax forums to get lot of answers for the past several years. For my situation, I didn't see any fair answer. I am going to try https://www.taxpayeradvocate.irs.gov/. Hope, they will understand my situation and help me. Happy New Year 2023 to all.

[VolvoGirl]

It's been answered here very clearly.  The employer part does not have a max like the employee part.  

[Opus 17]

@Critter-3 

I know what the original taxpayer wants to do, I’m pointing out that beyond declaring on form 941 that half their pay is SS-exempt, they will also have to claim the same thing on a corrected W-2 and W-3.  More routes to get caught.  

(Declaring wages that are exempt from SS tax is not impossible, I filed many 941s for my church, and the church is exempt from from employment tax withholding on the pastor’s salary.  But retroactively declaring half someone’s wages as exempt should raise red flags and the corrected W-2 creates an additional path for the situation to be noticed.)