The SSA-1099 received is incorrect and we haven't received a correct one. Also the amount in box 5 is negative and not showing on the 1040, why?

[kris0380]

We are entered the correct information for the SSA-1099 as we have been in contact with the social security office and they agree it should be correct.  Benefits and taxes were paid back from 2016 amounts received in 2017.  Why is the negative amount not showing on line 20 of the 1040?

Also, should we paper file instead of e-file the return since the information being filed does not agree with what was provided to the IRS?

[AJ]

The amount shown in Block 5 of a SSA-1099 will be negative when you pay back more Social Security than you receive during the year.  I understand that this is the case and that the amount shown in Block 5 is correct.  Unfortunately the tax rules are not what many might think.  Please see IRS Pub 915 for a detailed explanation (page 15 in the 2017 edition). You should not try to produce a negative income for this on the front of Form 1040.  Instead, the negative income should normally be claimed as an itemized deduction on Schedule A.  If less than $3000, it is subject to the 2%-of-adjusted-gross-income limit that applies to certain miscellaneous itemized deductions. Claim it on Schedule A (Form 1040), line 23.  If you are not itemizing, then there is no benefit.  If the amount is over $3000, there is a possible credit process that is a bit more complex to use.  See Pub 915 for the detailed description of the credit process that will end up of Form 1040, Line 73 with the notation I.R.C. 1341.

[ranamaska]

I realize the situation presented is for 2016/2017. I have a similar situation for 2022.

In 2022 I applied / received/ paid back social security benefits in full. The SECOND 1099 they sent shows the correct amount in box 3. DOUBLE the amount (repaid) in box 4. Then a negative amount (overpayment?) in box 5. The SSA looked up my account and verified the numbers were correct. So I can post these numbers in the return? Then wait for the IRS to question the error? Not my error. The document provider (SSA) verified document is correct. I do see that the negative amount seems to have no bearing on any other data entered on the return.

[DaveF1006]

Yes, you may report the negative numbers in the return in Box 5.. You will get a warning that mentions that although a negative value is valid, recheck your answer to make sure. Then X out of the warning to proceed. 

You are correct in the  respect that this doesn't impact your return.

@ranamaska