My mother passed away in early 2019, and she received a limited amount of Social Security income that year, which became part of her estate that passed to me. I flied a 2019 tax return on her behalf and included this in her income. Several months later, Social Security clawed back $700 of this amount, saying they overpaid mom in 2019. And then, in early 2021, they sent the $700 back with a letter saying they made an error.
I didn't expect to get a SSA-1099 for 2021 since this was reported on mom's 2019 return, but I just received one. I know I need to report the income or the IRS will ping my return, but the income should not be taxable to me. Can I do a negative adjustment to income to back that amount out of my taxable income. How do I do that in TurboTax? Can I enter it as a negative adjustment on Schedule 1 - line 8(z)? If yes, how do I do that?
Thanks much!
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Sorry - I meant to say the adjustment would be entered on Schedule 1 line 24(z).
I did a little more digging and figured it out. It can be adjusted through the very last income item - Miscellaneous Income - 1099A, 1099C. You enter the adjustment as a negative number and you have a good number of characters to type in an explanation of the adjustment.
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