Turbotax: "You have a W-2c coming. Since you deferred some of your Social Security taxes last year,..." Both my W-2's have maxed-out SS income/withholding, a problem?

[shappyj]

I had the same issue yesterday (2/20/21).  I was told by a rep on a phone call that this is a known issue that would be fixed in about a week.  He told me I would get an email about it.  I am not super confident in this or his answer since he had to go off and check with some people and he spoke poor English (at least for my ears,  I am not trying to be nasty or anything like that).

[DianeW777]

You did not defer anything.  Your employer was allowed to defer this tax.

Check the amounts in box 3 of your W-2 and the amount in box 4.  Box 4 should be 6.2% of Box 3. 

Review the IRS Notice 2020-65 which explains more about this topic.

To Employers: 

If you deferred the employee portion of Social Security tax under Notice 2020-65, when reporting total Social Security wages paid to an employee on Form W-2, Wage and Tax Statement, include any wages for which you deferred withholding and payment of employee Social Security tax in box 3 (Social security wages) and/or box 7 (Social security tips). However, do not include in box 4 (Social security tax withheld) any amount of deferred employee Social Security tax that has not been withheld.

To Employees:

If you had only one employer during 2020 and your Form W-2c, Corrected Wages and Tax Statement, for 2020 (if you get one later), only shows a correction to box 4 (or to box 14 for employees who pay RRTA tax) to account for employee Social Security (or Tier 1 RRTA tax) that was deferred in 2020 and withheld in 2021 pursuant to Notice 2020-65, no further steps are required. 

This does not affect your tax return, only your social security account. For most employees no action is required.

[brennandog]

My withholding was correct 6.2%, my employer did not defer this tax --  I believe that TurboTax has an issue when there is income from W-2's and 1099-NEC 's, the latter of which a portion can be deferred from your SE Tax - wrongly attributing it to ones W-2 having deferred SS...

[efiler123]

I did the same and selected no for self employment covid relief even thought my llc did not have a self employment income given that I just started. Not sure what is triggering the W2C - worst situation is that it does not go past and program is stuck. phone support has no clue !!!

[efiler123]

tried to change the 40 cents to 50 plus and see if the rounding issue makes it go away ! but nothing changed - still get the W2c error and worst that the screen keeps spinning thereafter and nothing happens. there is some bug which kills things after this calc

TurboTax product specialists - if you are reading this - please fix this issue as otherwise there is no choice but to abandon the program and pay someone else to file !!

[Pheran_TT]

Same problem here, verified that all my W2s are entered/withheld correctly.  It's obviously a bug, but since it doesn't affect the filing, shouldn't matter much.

[ACMinn]

I'm seeing the same thing yesterday, 2/20/21 for the first time.

[SamS1]

Delete the W2s and re-enter.  Just got this update: The error with deferral of SS that was causing the pop up at Review that said, "Heads up! You have a W-2C coming" was fixed in the newest release on 2/19. Only the customers who may legitimately receive a W-2C will still get the pop up now.   If you are using TurboTax Desktop, make sure your software is updated.

Might try clearing your cache and cookies before re-entering. Cookies are small files that temporarily store data on your computer. We use them to personalize your experience so you see information you already entered and not items that are irrelevant or repetitive.  On rare occasions, they may make your browser think you already did something that you still need to do. To fix that, you'll need to delete (clear) the cookies from your browser.  Each browser has a slightly different method for deleting cookies. Choose the browser you're using:

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The pandemic has affected your taxes in many ways. Including reporting in TurboTax the amount of stimulus money you received. Click Here for more information on how the Pandemic affected your 2020  taxes.

[mnichol2]

Thanks for the work around.   While I sincerely appreciate it - when can we expect Turbotax to correct the root of the problem?

[20YEARS]

I got the same message. All SS and Medicare Tax W/H was correct on the W-2, ie., no deferral of any kind. I think it is a "global cover their butt" kind of reply from TT to the whole deferral program in the CARES act. The employer who issued the W-2 was also NOT happy to hear from TurboTax that they'd deferred an employee's SS Tax when they did NOT do it in the first place. Bottom line is I'm ignoring the W-2c message since I've got proof that all W/H was done correctly (ie., no deferral).

I also ran into it in a Schedule C scenario where it asked me if I wanted to defer paying a portion of the calculated SE Tax. I replied NO and then TT went ahead and completed all of the forms for doing it with "zeros" entered everywhere. When TT reviewed the return I got MULTIPLE messages of errors relating to the form used to accept a deferral....telling me "this field needs to be blank"...so even entering a ZERO, which TT did in response to my saying NO to deferring, was all it took for TT to screw up the interview process. I deleted all of the "zeros" in the offending rogue form, did the error check again, deleted the offending form and all was good.

[Mk53]

Worked for me.  Appears to be a small bug.

Had to revisit the forms to clear the "0." value that TT plugged in, but then got a clean review.

Thanks!

[Linda1943]

I have the same issue as others.  I did not defer any Social Security payments this year or any year.  In fact, my salary has not changed in several years and the same amount has been paid into Social Security and Medicare all of those years.  I have receipts for every monthly payment to the IRS.  My husband, Harold Neff, had no taxable income during 2020 so there was nothing to defer.  What is this all about? 

[startzell]

Can you describe where the extra "0" was? On which form?

[startzell]

Specifically, can you say what the form was? How can I find it to fix that same issue?

[20YEARS]

Hi...sorry not to reply sooner. I discovered the entries of "0" when i conducted the federal review. It would come up as an error saying something like "this entry needs to be blank" at which point i deleted the TT entered "0". I believe this was how I got rid of it on the return that contained a schedule C and SE.

For the W-2 return, I'm still getting the message telling me I'll be getting a W-2c at some point in the future. I can't get rid of the message. The SS Tax W/H and Medicare Tax W/H are exactly what they should be on the W-2 I got...6.2% and 1.45% respectively. The TT warning about a corrected W-2c being in my future has got to be some kind of "global" warning (bug) regardless of whether or not the amounts W/H are correct or not. It would seem that the TT program ought to be able to DO the math and realize there has been NO deferral.