using 2019 info for 2020

[bullturtle]

If I use my 2019 info for my 2020 return to get the better amount how will it affect my taxes and social security in the future.  During filing it says I will be receiving a w2c from my employer once I pay the social security amount.  Is this because I used that income even though that is not what I earned in 2020 and will I have to repay any of the amount on my return or will the IRS know that it is because of COVID? Or is it that I have to pay social security on my unemployment?

[xmasbaby0]

You have become confused by something you heard about a 2019 lookback.   You do NOT enter 2019 income into your 2020 tax return.   You only enter your 2020 income into the income screens for 2020.

Sure hope you have not e-filed it or you will have a problem.

Here is what you needed to understand about the lookback:

Many people had lower incomes during the pandemic in 2020 due to reduced work hours, layoffs, etc.  Or they received unemployment benefits.   These factors affect how much earned income credit and additional child tax credit you can get on your 2020 tax return and affect your 2020 refund.

There is a “lookback” option that allows you to use your 2019 amounts for earned income credit or child tax credit.   You can choose whether to use your 2019 amount or your 2020 amount.  Choose whichever amount gives you a better tax refund for your 2020 refund.

You can see this and choose in the earned income credit section  in Deductions and Credits. 

You still MUST enter all of your 2020 income into your 2020 tax return, including any unemployment you received.

Please follow these steps in TurboTax:

1. Login to your TurboTax Account 
2. Click on the Search box on the top and type "EIC"
3. Click on “Jump to EIC”
4. Answer the questions until you reach the screen "Do you want to use last year’s earned income?"
5. Note your current refund amount using your 2020 earned income at the top of the screen.
6. Click "Yes", enter your "2019 Earned Income" if the field is blank and click "continue".
7. Compare the new refund amount using your 2019 earned income with the previously noted refund amount using your 2020 earned income.

[bullturtle]

I'm sorry I was referring to the lookback.  I did enter all of my 2020 info in the actual w2 area.  So what is the w2c.  Why is it telling me that I will have to pay more social security?

[xmasbaby0]

About the W-2c    ....... there  is known issue that with that which should be corrected by an update late this week.  

[bullturtle]

What is a W2C?

[xmasbaby0 · Accepted solution]

It is a corrected W-2 from your employer....but you will not need one.   It is a little software bug that is triggering it.   They say that it will be corrected by end of day on Thursday.   

[bullturtle]

Yay!  Thank you for all of your info.  It was extremely helpful!!

[concage]

Hi.

I am using the CD version and it doesn't give me the option to "lookback" or "jump to EITC". I did go to the EICT section and went through everything again but it doesn't give me the option to use my 2019 income. Does anyone have any suggestions?

Thank you in advance!

[ReneeM7122]

Use the following steps to go directly to the Earned Income Tax Credit section:

• Locate the search box in the upper right corner
• Type in “earned income credit” (be sure to enter exactly as shown here) and click Find)
• The search results will give you an option to “Jump to earned income credit”
• Click on the blue “Jump to earned income credit” link

Here is a TurboTax link to information about the Earned Income Credit.

@concage

[wgfpd154]

I need more information on this "Look Back" option and how it then calculated and populated my credit of EIC for 2020 Taxes. It APPEARS as if my 2019 ACTUAL EIC amount was NOT entered. The program instead utilized my 2019 WAGES and AGI earned income to calculate a NEW EIC amount, which was actually $58 higher than given in 2019 due to some annual EIC raise??? My return was accepted on 2/11, as part of the IRS test batch, and I continue to wait for a DDD after 24 days now. IRS doesn't even show a return was filed, and MANY are said to have gone to ERRORS resolution department at IRS for errors in software.

Can ANYONE confirm whether or not this calculation of EIC is the correct way to compute my credit using lookback? OR was TT supposed to input exactly what I received in 2019, WITHOUT any increases?

Since talking to IRS or getting any answers by calling them, we are pretty much attempting to find out what in the world we did wrong.

[Cynthiad66]

Your return has been accepted by the IRS we do not have access to that information because of the privacy issues.  You need to contact the IRS to determine the status of your return.  Error Resolution at IRS means that they have an issue on their end and will work to correct it.

This is a new deduction based on the CARES ACT and there could be numerous errors in processing until perfected.  IRS will contact you as they are working on the return.  They do not notify TurboTax about your return processing.

[wgfpd154]

I am not in the ERS department as far as I know. Just trying to get clarification of how the credit is calculated for the LookBack EIC and ACTC using 2019 income or earned wages. Does it use the 2019 or higher earned income and calculate the EIC credit according to the new 2020 table. Or does it take the 2019 value of the EIC given that year and just populate that into the EIC for my 2020 return. People are getting the impression that the value needs to be exactly the same and mine is $58 higher of a credit than 2019.