SS tax error

DX77 — Sat, 12 Jul 2025 15:23:31 GMT

I live in the UK and file US taxes. I have lived in the UK for many years, I started SS in 2019 and have never paid taxes on my SS benefits. This year was no different under the SS tax exempt section I answered yes when prompted do you live in one of the following countries UK. No errors were found when the review was done. I was receiving a refund. In April I revived a CP11 notice from the IRS stating my I made an error calculating my SS tax and the IRS corrected the error, and I now owe money. I filed a written response stating I live in the UK and the error was not mine. I never received a response from the IRS, instead I received a CP501 payment past due letter! Not wanting the mounting interest, I paid. My question is why?? I paid for Turbo Tax followed their program, they stated no errors and confirmed my refund. If your program had a glitch that is not my problem. Your error you need to take responsibility and remembrance me.

Re: SS tax error

pk — Sat, 12 Jul 2025 18:01:50 GMT

@DX77 what I get from your post :

(a) You a US citizen / GreenCard have been living in the UK for sometime ( i.e. you are legally a UK resident) -- tax-home UK. How was this intimated to the IRS/ tax processing ? . When did you establish UK tax-home ?

(b) You have been receiving SSA benefits since 2019. Did you have issue with any year before 2024 tax year filing ( CP11 issued because IRS processing did not recognize US-UK tax treaty article on taxability of SSA benefits ?

(c) You must have other taxable income for this to become an issue --- are those earnings US sourced or Foreign sourced ?

What I am missing here is that the AUR system should have issued a CP2000 first and then a CP-11. I am assuming that you reported the SSA-1099 and then showed the taxable portion to be zero ( can you confirm this by inspecting form 1040 boxes 6a and 6b ? ). This then could generate an error requiring human intervention. Thereafter and absent a treaty article assertion, a new tax computation and CP-11 could be issued --- IRS has no way of knowing that you have chosen to assert treaty article.

What should have happened is that on form 1040 line 6b should be computed as per normal ( i.e. no treaty article asserted ) and then on Schedule -1 under adjustments line 24 , " Other adjustments an amount equal to line 6b of 1040 with comment / explanation " US-UK tax treaty article 17 ".

I admit that this is a bit of a round about way to achieve the intent/text of the Tax Treaty. The issue here is that one needs to recognize the SSA-1099 amount as income ( else a CP2000 will be issued -- unreported income ) and at the same time it is only the taxable amount that needs to excluded ( to satisfy the treaty condition that only the resident state cam tax the "pension" ). Note that, at least for UK, it is all pensions and lump-sum payments . annuities etc. that are taxable ONLY by the resident state.

Is there more I can do for you ?

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SS tax error

Re: SS tax error