Did I overpay SS taxes? Do I have to file an amended return if my income, AGI and taxable income didn't change?

[Anonymous]

I just received a W-2c for myself for 2020 with ss withholding adjustments - apparently they under-reported the initial amount. I earned $13,209.23 and ss withheld $818.97 which is exactly 6.2%. When amending my return I realized my husbands W2 had wages (box1) of $130,750, but ss wages (box3) of $137,700 and ss withholdings of $8537.40 - the max on the $137,700. He also had medicare wages (box5) as $142,750 and medicare withholdings of $2069.88. TT never flagged anything.

Question 1- is it possible/normal for someone to have ss wages and medicare wages (box 3 and 5) higher than their reported wage income (box 1) or did he overpay ss and/or medicare taxes?

Question 2 - if that is possible/normal on his W2 then did we overpay as a couple? Our total ss taxes paid that year are $9356.37. We file jointly.

Question 3 - if we didn't overpay then do I have to file an amended return if TT is not reporting any difference in the amount we owed that year ( I put the adjusted amounts of my W2-c into TT and did the "review my taxes" and the wages, agi and taxable income didn't change).

Thank you so much!

[Critter-3 · Accepted solution]

Question 1- is it possible/normal for someone to have ss wages and medicare wages (box 3 and 5) higher than their reported wage income (box 1) or did he overpay ss and/or medicare taxes?  Yes this is possible very possible.  For instance look at box 12 code D ... the 401K contribution is not subject to fed taxes but is for SS/medicare. 

Question 2 - if that is possible/normal on his W2 then did we overpay as a couple? Our total ss taxes paid that year are $9356.37. We file jointly.  The overpayment is Per Person ... you do not add your SS wages for you both. 

Question 3 - if we didn't overpay then do I have to file an amended return if TT is not reporting any difference in the amount we owed that year ( I put the adjusted amounts of my W2-c into TT and did the "review my taxes" and the wages, agi and taxable income didn't change).  In your case there is nothing to be amended. 

[xmasbaby0]

You cannot overpay SS "as a couple."    Those limits are per person.   Your spouse correctly had the limit of $8537.40 withheld for 2020 by his employer.    You would also have  had a limit of $8537.40  SS withholdings for yourself and you did not exceed that limit  (or even come close to the limit), so you are okay too. 

  When you enter W-2's into a joint tax return you have to be careful to assign the W-2 to the right person.   When couples make the mistake of entering all of their W-2 income under only one name it can appear to be excess SS withheld and result in an inflated refund and then a year or two later, a demand from the IRS to repay the refund with interest.

If your W-2C did not result in additional tax or an additional refund you have no reason to amend.

[Anonymous]

Thank you so much - that is the exact discrepancy - his 401K withholdings.  I really appreciate your thorough answer!

[VolvoGirl]

That's why we always tell people not to use their last paystub to  enter their wages but wait for the W2.  The W2 usually does not match it.  There are many items (pretax items)  that can affect it.   And if you file wrong you will have to amend later.

[Opus 17]

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@Anonymous wrote:

Thank you so much - that is the exact discrepancy - his 401K withholdings.  I really appreciate your thorough answer!

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Social security is based on box 3, not box 1. Box 3 includes items that are considered "earned income" but are not taxable wages, such as retirement contributions and a few other items. 

You do not need to amend based on your corrected W-2 as long as box 1 and box 2 did not change.