I had to repay an amount for disability benefits that was included in last years income. Where do I file the overpayment?

[ThomasM125]

It goes on the second page, since it is over $3,000.

@LynneNLam

[Khaselden2]

I receive overpayment notice for gross amount paid over Dec 2021-Feb 2022 of appx $6000. I only received $5600 net. (Gross minus SS and Medicare). What’s the reason I need to pay entire amount? Will I get some  kind of credit with SS and Medicare?

[JamesG1]

Gross income reported in box 1 of a W-2 (if this income were paid on a W-2) would have been $6,000.  After Social Security and Medicare payments reported in boxes 4 and 6 of a W-2, you would have netted the $5,600.  It sound like the $6,000 is gross income and subject to repayment.

From whom did you receive the overpayment notice?  If the disability notice was received from the Social Security Administration, the discrepancy that you mentioned may ultimately be adjusted.  If the disability notice was received from an insurance company or private company, it may not be adjusted without you taking other actions.

Also, does the notice state that you are to pay back the $6,000 or that the $6,000 has been paid back in 2022?  At this point, the facts are not clear.  

If you received taxable income in 2021 and paid all or a portion back in 2022, you may qualify for a claim of right repayment on your 2022 Federal 1040 tax return.

A claim of right repayment occurs when a taxpayer is required to repay income that they had reported and paid tax on in a previous tax year. The repayment must be of funds that, when received, the taxpayer had a reasonable belief he or she had unrestricted access to.

See also this information.

@Khaselden2

[Khaselden2]

This is from an insurance company for STD benefits. 
I was paid $1800 in Dec 2021. Of which I received a W-2, filed and paid taxes. 
Continued to receive benefits until middle of February 2022(a gross amount - Medicare and SS tax). 
Received notice March 2022 that I was overpaid the entire amount.(another story) to gross amount of $6000…instead of net amount of $5600(what I received)
From your response,  I will receive some sort of credit of $6000 via a form to file in 2022.  So anything paid as taxes for 2021, I will get to lower my AGI for 2022, in effect “getting my 2021 taxes paid back”

[Khaselden2]

I have not paid the $6000 because I was questioning amount. 

[JamesG1]

Have you received proceeds from the Social Security Administration that will allow you to repay the insurance company?

Do you have legal representation that can review your individual situation and provide you guidance?

If the re-payment is made in 2022, you may have a claim of right repayment for the $1,800 reported as income in 2021.  

If the insurance company is repaid for the amount received in 2022, the insurance company should not generate a W-2 in January of 2022.

[rmagee]

This was such a great help!!!

[janice_1]

I repaid disability benefits that were overpaid to me because of a coding error back to 2017, 2018, 2019 & 2020. The company issued amended T4A's for the amounts I should of received but now I owe a lot of money due to no fault of my own. The company is insisting that a credit will be issued for the 2022 tax year for the repayment amounts. Should I not be able to use those credits now in an adjustment in order to not to owe this huge bill to CRA?

If I cannot use the credits for prior years, should the company not of sent out the amended T4A's until the 2022 tax year as well?

Thank you for your help.

[Barb8509]

I received lump sum SSDI in 2022 and had to pay it all back to third party payor for prior years . 
do I still have to claim it as income even though 

I gave it away!

[BrittanyS]

Yes, you must include the taxable part of a lump-sum payment of benefits for the tax year the benefit is received.  There are two methods to determine the amount of income that is taxable:

1. Use the current year's income to figure out the taxable part of the total benefits
2. select the lump-sump election method  (figures the taxable part of all benefits based on earlier year benefits using that year's income.  

For more information, see the link below:

Social Security Disability Income Back Pay

@Barb8509 

[Dr416]

I know this goes on itemized deductions, but I am unable to get it to enter on line 16. Can you help?

[AmyC]

If you repaid more than $3,000, you can claim the repayment. Here are your options and how to enter it, see Turbo Tax article What is a Claim of Right Repayment.

The repayment only helps on deductions if you are itemizing. Most people find the credit in their favor. The steps are included in the article above.

@Dr416