I entered total Soc Sec from box 5 on the SSA-1099. Completed the remainder of the income section. In the Federal Tax review, the total income used includes 100% of the Soc Sec income when it should be only 85% according to IRS publication 915-Worksheet 1 and using my other income show in Turbo Tax. Is there a solution?
If you are looking at a summary screen or review screen those show the full amount as income and lump a lot of stuff together. You need to check the actual 1040 form and make sure it's right. Before filing you can preview the 1040 or print the whole return
https://ttlc.intuit.com/community/accessing/help/how-do-i-preview-my-turbotax-online-return-before-filing/00/26160
Check 1040 line 6b for the taxable amount.
Instead of the review page you need to be looking at the actual tax form. That review page can confuse people. What do you see on lines 6a and 6b of the Form 1040?
TAX ON SOCIAL SECURITY
Up to 85% of your Social Security benefits can be taxable on your federal tax return. There is no age limit for having to pay taxes on Social Security benefits if you have other sources of income along with the SS benefits. When you have other income such as earnings from continuing to work, investment income, pensions, etc. up to 85% of your SS can be taxable.
What confuses people about this is that before you reach full retirement age, if you continue working while drawing SS, your benefits can be reduced if you earn over a certain limit. (For 2019 it was $17,640— for 2020 it was $18,240; for 2021 it was $18,960. For 2022 it was $19,560 — for 2023 $21,240) For 2024, $22,320.
After full retirement age, no matter how much you continue to earn, your benefits are not reduced by your earnings; your employer will still have to withhold for Social Security and Medicare. If you work as an independent contractor then you will pay self-employment tax for Social Security and Medicare.
To see how much of your Social Security was taxable, look at lines 6a and 6b of your 2023 Form 1040
https://ttlc.intuit.com/questions/1899144-is-my-social-security-income-taxable
https://www.irs.gov/help/ita/are-my-social-security-or-railroad-retirement-tier-i-benefits-taxable
You need to file a federal return if half your Social Security plus your other income is $25,000 when filing single or head of household, or $32,000 when filing married filing jointly, $0 if you are filing married filing separately.
Some additional information: There are 11 states that tax Social Security—Colorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, Rhode Island, Utah, and Vermont These states offer varying degrees of income exemptions, but two mirror the federal tax schedule: MN and VT.
The tax laws for 2024 will change——for tax year 2024 Missouri and Nebraska will no longer tax SS
If you are looking at a summary screen or review screen those show the full amount as income and lump a lot of stuff together. You need to check the actual 1040 form and make sure it's right. Before filing you can preview the 1040 or print the whole return
https://ttlc.intuit.com/community/accessing/help/how-do-i-preview-my-turbotax-online-return-before-filing/00/26160
Check 1040 line 6b for the taxable amount.
Instead of the review page you need to be looking at the actual tax form. That review page can confuse people. What do you see on lines 6a and 6b of the Form 1040?
Hello: I think the SS taxable portion is still being calculated incorrectly by TurboTax. The IRS Instructions for 2023 Form 1040/1040-SR provides a worksheet to calculate the taxable portion of Social Security payments (pg. 32 of 114 pages). The worksheet contains 18 lines that are used to come up with the proper amount to be shown on 1040 line 6b. In my case, allowing TurboTax to calculate the amount, it plugs in $3,869. Running the same numbers through the IRS worksheet, it shows it to be $6,196 (big difference). I think the program is looking for a simple solution when it is a multi-step ITTT calculation. I think I'm going to need to file a 1040-X to fix this problem. It also throws off my state return. I look forward to hearing if my observation is correct.
You should not use the worksheet on the back of the SSA-1099. It can be complicated to figure out even though it looks simple. Turbo Tax figures it all out for you.
When you enter 1/2 of your ss on line B it is not being subtracted from anything. It is being ADDED to ALL your other income to see if any of the ss will be taxable to you.
To see the Social Security Benefits Calculation Worksheet in Turbo Tax Online version you would have to save your return with all the worksheets to your computer. Or if you are using the Desktop CD/Download Software you can switch to Forms Mode (click Forms in the upper right) and click on SS in the list on the right side.
Hello: Thank you for your quick reply to my dilemma, apologizes for my delayed response. After downloading all the appropriate TurboTax worksheets, I completely understand and agree with your response to my inquiry. However, the worsheets exposed the real underlying problem, the calculation of line 3 on the Social Security Benefits worksheet. Using the TurboTax generated 1040, the total I come up with on all the lines listed is $3,256 higher than the total entered on the worksheet. This difference is what is throwing off the end result on the taxable portion of my Social Security entry. I'm not sure where to go from here as I don't think any of the entries can be adjusted. I appreciate your help with this.
Did you use that worksheet on the back of the SSA1099 and enter amounts that you came up with instead of just entering the amounts exactly as shown on the SSA1099 to begin with? You are supposed to just enter the amounts from the front side of the SSA1099----no calculations necessary for you to do. The software takes care of it for you.
Line 3 that says combine lines 1z,2b,3b,4b,5b,7&8? More than the SS worksheet on IRS page 32 or the Turbo Tax worksheet? You probably should call in for that or we can try to have a moderator look at your info. You can send them a sanitized copy of your return. @xmasbaby0 Can you ask a moderator to look at this?
I understand and agree. I am not doing any other calculations other than comparing the line 3 amount on the Social Security worksheet with the total of the numbers used from the 1040. The amount entered by TurboTax on line 3 is $693 lower than just the 1099-INT and 1099-DIV as reported by Schwab to the IRS. Lines 4b and 5b represent another $2,565 in taxable income that is not being included. I got tripped up once before when the IRS sent me an inquiry when one line on Schedule B reported by Schwab to the IRS differed from my entry on my 1040. I'm just trying to avoid another "surprise letter".
You cannot compare the Social Security Benefits Worksheet in TurboTax to the worksheet in the IRS instructions. Some of the lines are different because they work differently in the way they handle certain less-common situations.
In particular, you cannot compare line 3 on the two worksheets. Line 3 on the TurboTax worksheet includes Form 1040 line 2a. Line 3 on the IRS worksheet does not include line 2a.
Before you go any further, read the Exception in the instructions for Lines 6a and 6b in the center column on page 30 of the Form 1040 instructions. If any of the situations listed under "Exception" apply to you, you cannot use the Social Security Benefits Worksheet in the Form 1040 instructions. Instead, you have to use a worksheet in either IRS Publication 590-A or IRS Publication 915. TurboTax incorporates some of the Exception conditions into its worksheet, which is one reason that it differs from the worksheet in the Form 1040 instructions.
Do any of the Exception conditions in the IRS instructions apply to you?
Also, please clarify whether you are using TurboTax Online or the CD/Download TurboTax software.
Thank you for your reply with the additional information, however my entry into line 2a is 0 and none of the exceptions listed in the 1040 instructions on page 30 apply to me. I would like to refer you, via this link, to the IRS.gov "Interactive Tax Assistant (ITA)": https://www.irs.gov/help/ita. Under Retirement: Pensions, IRAs, Social Security" Click on the 1st line "Are my Social Security or railroad retirement tier 1 benefits taxable" and enter the numbers from your TurboTax generated form 1040 in the interactive form as requested and view the taxable amount the IRS shows. In my case it is almost double the amount calculated by TurboTax. This by the entity whose algorithm is going to compare their number to my electronically submitted line 6b. I still see a problem.
The Interactive Tax Assistant is not part of a tax return. The taxable amount of Social Security benefits on Form 1040 line 6b has to be calculated using the Social Security Benefits Worksheet - either the one in TurboTax or the one in the IRS instructions. You started off comparing the two versions of the Social Security Benefits Worksheet, but you have gone off on tangents.
If your manual calculations on the Social Security Benefits Worksheet in the IRS instructions come out with an amount on line 18 of the worksheet that is different from the amount on line 18 of the TurboTax worksheet, we can explore why there is a difference. But you have to be clear and precise, and focus on the Social Security Benefits Worksheet.
When you refer to a line number, please make sure it's clear what form or worksheet you are referring to. Your reference to "my entry into line 2a" is not clear because a lot of forms have a line 2a, and the Social Security Benefits Worksheet is not one of them. And why do you say "my entry"? Are you talking about a form where you key an amount into TurboTax from a form that you received, such as box 2a on a 1099-DIV or box 2a on a 1099-R?
Also, you still have not said whether you are using TurboTax Online or the CD/Download TurboTax software.
As I said earlier, there are differences between the TurboTax worksheet and the IRS worksheet because TurboTax has modified the worksheet to handle some situations that the IRS worksheet does not handle. Among those differences, TurboTax has added lines 19 and 20 to handle the lump-sum election. What is on line 19 of the Social Security Benefits Worksheet in TurboTax? If there is an amount on that line it could account for the difference in the amount on Form 1040 line 6b. If you have an amount on line 19, what are the exact amounts on lines 18, 19, and 20 of the TurboTax worksheet, what is the exact amount on line 18 of your manually calculated IRS worksheet, and what is the exact amount on Form 1040 line 6b?
In a previous post you said that you think the root of the problem is a difference in line 3 of the Social Security Benefits Worksheet. Another of the differences between the TurboTax worksheet and the IRS worksheet is that line 3 is not the same. But if you think that's where the problem lies, what is the exact amount on line 3 of the Social Security Benefits Worksheet in TurboTax, and what is the exact amount on line 3 of your manually calculated IRS worksheet? What are the exact amounts on each of the following lines on the Form 1040 that you filed: 1z, 2a, 2b, 3b, 4b, 5b, 7, and 8?
Finally, let me say that it is extremely unlikely that the calculation of taxable Social Security benefits in TurboTax is wrong. The calculation and the worksheet haven't changed in years, so there's nothing new about it in this year's TurboTax. By now, any bugs that might have previously existed would have been found and fixed years ago.
OK, starting from scratch - I am using TurboTax 2023 Deluxe Fed+State on a Windows 10 desktop PC
1) I just downloaded the latest IRS 1040 instructions and printed the instructions for Lines 6a, 6b and 6c on pages 30 and 31, and the Social Security Benefits Worksheet -- Lines 6a and 6b on page 32.
2) I then filled in the requested figures from my TurboTax generated 1040-SR.
3) The worksheet on line 18 showed that I should enter the taxable amount of $6,196 on 1040-SR line 6b.
4) TurboTax calculated the taxable amount that it entered on line 6b as $3,869.
5) The IRS Interactive Assistant (ITA) using the sane input figures showed a taxable amount of $6,195
6) For sake of comparison I purchased the H & R Block 2023 Deluxe Fed + State which I installed on the same Windows 10 desktop
7) The H & R Block returned a taxable amount of $4,798
😎 Both TurboTax (4/17-2024) and H & R Block (4/18/2024) had the latest program updates installed
9) The exact same figures from my TurboTax generated 1040-SR were used in all three trials
10) I was the IT manager for an auto dealership group for 22 years and can certainly identify when calculated results from the same set of data points are varying to this degree that something is amiss, especially when the agency charged with enforcing the law comes up with the same results via two different input methods. I still suspect that something is wrong. I'm concerned that your advertised guarantee of error free returns might have a problem.
Hello: In response to your Saturday (4/20/2024) message I am going to apologize to you for a rookie mistake I made when I was calculating the value of line 3 on the "Social Security Benefits Worksheet" (both TurboTax and Federal). The dangers of doing detail work after midnight had me fat finger the values of 1040-SR lines 7 and 8 as additions rather than the subtractions they really are. It took me looking at the same forms 10 times before I saw what I had done. As it turns out the calculated value that TurboTax entered on my 1040-SR "Social Security Benefits Worksheet" line 3 was accurate. I am very sorry for any trouble this may have caused.