Can't figure out why TurboTax assigned my social security input (from W2 downloads) to a schedule 3 form as excess social security tax -- and make us think we owed less. After talking with a TurboTax associate who said they could log in to my online tax form, they couldn't tell me what went wrong. "Maybe you typed something in wrong....."
So IRS contacted me next to tell me that the error that Turbo Tax initiated means that we in fact owed $8,000 more than we anticipated.
If we owed the money, so be it, but we were led to believe that our taxes were initially filed correctly. Now we also owe interest.
The cost of the interest and fees is about the amount that we would have spent on a CPA to do our taxes. What a waste!!!
Turbo Tax only calculates what you enter. It doesn't know if you entered something wrong or if you assigned a W2 to the wrong spouse. After you entered the W2s it showed you a screen showing all the W2s and who they were assigned to so you could change it.
You only get excess SS back if one person had more than 1 employer and those employers took out more than the max of $9,114.00 (for 2022).
Add up all the W2 box 4 for both spouses and subtract the max $9,114.00. Is that the excess on 1040 Schedule 3 line 11 which goes to 1040 line 31? Then all the W2s were assigned to the same person.
Or you entered a W2 box 4 wrong. There should be a sheet for each W2 in the full pdf file of your tax return showing what was entered.
Or check W2 box 12. You may have entered Code A by mistake.
THEN when you do 2023 next year, if you transfer over from 2022 you should delete ALL the W2s and re-enter them from scratch making sure to assign them to the right spouse.
If you cannot figure out what the IRS means/changed and the TT help is not working then it may be time to call the number on the notice and ask the IRS directly or call the taxpayer advocate's office or seek local professional help who can talk to you face to face and see the actual notice and the return.
TurboTax offers an accuracy guarantee.
See https://turbotax.intuit.com/corp/guarantees
If you believe there was a calculation error, you can make a claim:
Hello nottoohappy,
So sorry to hear about your issue. While I don't have an explanation as to what or why it happened, you do have the TurboTax Accuracy Guarantee where we want to make right any errors that may have been caused by the software or an expert. Here is the form to fill out: Accuracy Guarantee Claim
If, after review, the accuracy guarantee team determines we were at fault, TurboTax will reimburse you for any penalties or fees. As you alluded to, any taxes owed will still be your responsibility.
I hope that helps and good luck.
First it was up to you to review all imported information for accuracy so if the upload was incorrect, it was your error not the program's.
Also did you have more than one W-2 ? If so the excess SS withholding would be correct however if you are married and you each had 1 W-2 form AND both W-2s were assigned to the same person then that is also a user entry error that the TT program would not catch but the IRS will.
Here is additional information regarding excess social security tax that may help:
It may also be a good idea to run the numbers from your return into TaxCaster to check on the anticipated/adjusted refund matter: https://turbotax.intuit.com/tax-tools/calculators/taxcaster/
I agree with what Critter-3 stated. If there are multiple W-2s and the user is filing jointly, the user should always doublecheck and make sure the W-2s are assigned to the correct person (the primary taxpayer or the spouse).
If the user doesn't doublecheck, what happens is that they'll be wrongly stating on the tax return that they had too much Social Security tax withheld (there is an annual limit of how much Social Security tax needs to be withheld) and that they should get a refund of excess Social Security tax withheld. The IRS receives a copy of all W-2s filed under either the primary or spouse's Social Security Number and doublechecks that what was reported on the tax return was accurate.
Ruth, CPA, Esq.
It was not the case that two W2s were assigned to the same person. I actually reviewed my tax form with a TurboTax assistant and they couldn't determine what happened. I appreciate you helping me to figure out how it was my fault, but as I've gone back over the form multiple times, it is not clear where TurboTax accounts for the social security that one has paid, or how it was assigned.
The positive end of your reply wants to make your answer the best. But the one that allows me to see whether TurboTax will pay the interest and fees on taxes owed has to preside.
Thank you for the link providing more information on excess tax paid. I actually called two IRS agents to review that information before contacting the TurboTax associate. So by that time, I was aware that the excess tax was errant. As I mentioned in the other reply, it is not easy to trace that error because the program doesn't show you where your W2 information winds up.
All I know is that I imported it correctly as all the other numbers: income, taxes paid, are correct. I would have to have researched how much I was supposed to have paid in social security, and then compared it to my W2 form to know. This feels like the same aptitude to check in advance whether your bank is taking out enough for escrow.
Thank you for your reply. All I did was import the W2 forms. If they were assigned to the same person (behind the form), that fact is not transparent to the user. After going back through my online form with a TurboTax customer service rep, I can see the page where it asks for the two W2 form entries--I see one for me, and one for my spouse. Not two for me and none for my spouse--which would have to be the case in order for mine to show up as "excess SS paid".
Turbo Tax only calculates what you enter. It doesn't know if you entered something wrong or if you assigned a W2 to the wrong spouse. After you entered the W2s it showed you a screen showing all the W2s and who they were assigned to so you could change it.
You only get excess SS back if one person had more than 1 employer and those employers took out more than the max of $9,114.00 (for 2022).
Add up all the W2 box 4 for both spouses and subtract the max $9,114.00. Is that the excess on 1040 Schedule 3 line 11 which goes to 1040 line 31? Then all the W2s were assigned to the same person.
Or you entered a W2 box 4 wrong. There should be a sheet for each W2 in the full pdf file of your tax return showing what was entered.
Or check W2 box 12. You may have entered Code A by mistake.
THEN when you do 2023 next year, if you transfer over from 2022 you should delete ALL the W2s and re-enter them from scratch making sure to assign them to the right spouse.
That makes sense, "it only calculates what you enter". However, I downloaded one W2 form me, and one for my spouse. Not sure what else I entered.
When I return to the online filing, here's what the top line says (with personal information removed)
Upload your tax documents and we'll autofill your return
Important:Had a job
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It shows two separate W2s for two people. Whatever else seems so obvious to everyone replying to my post I'd be happy to acknowledge once you all show me where I was supposed to look to see the W2s specifically assigned to one person. I'm a data analyst, and I review numbers in systems. I use SQL, Tableau, MS Access, R, & PowerBI. I trace data when I see errors in ultimate calculations. Only now do I know that the places my data showed up TurboTax is not what should have been expected. I didn't previously, but now have the instinct that a social security credit is probably a red flag. Not sure how one would know that when relying on a system that suggests it is %100 accurate.
If you cannot figure out what the IRS means/changed and the TT help is not working then it may be time to call the number on the notice and ask the IRS directly or call the taxpayer advocate's office or seek local professional help who can talk to you face to face and see the actual notice and the return.