Income repayment

Forum|Forum|7 years ago
June 5, 2019
1 reply
10 views

My company overpaid me, an employee, 3,100 in 2015. I repaid them in 2016. I have a letter stating the amount and that it was repaid in 2016. They gave me this rather than a modified W-2 and said I can adjust this year's income. Where do I report this in turbotax?

TurboTax Premier Online

Best answer by

Since your repayment was more than $3,000, there are two possible ways of doing the calculation.

Method 1 is to take a deduction, which is the simplest method but may not get you the full benefit.

To calculate the repayment as a deduction, (Method 1):

Federal taxes - Deductions & Credits - Check for More Tax Breaks - Other Deductions & Credits - Show more - Other Deductible Expenses
When you get to the screen that shows Less Common Expenses, click No
The next screen will have Any Other Deductions? at the top. Please answer YES to "Did you have any other deductions that are not subject to the 2% limitation?"
Please enter the amount you repaid under, "Claim of Right Repayment (Only if over $3,000).

To explore the more complex route of calculating the credit (Method 2), please refer to IRS Publication 525 (https://www.irs.gov/pub/irs-pdf/p525.pdf)

NOTE: If you choose to follow the more complex route and use the credit:

You will need to use the Desktop version of TurboTax (available here: https://turbotax.intuit.com/personal-taxes/cd-download/)
The amount of the credit can only be entered in the Forms mode
Any entries made directly into forms will waive the Accuracy Calculations Guarantee (https://turbotax.intuit.com/corp/guarantees.jsp)

Anonymous

Answer

Since your repayment was more than $3,000, there are two possible ways of doing the calculation.

Method 1 is to take a deduction, which is the simplest method but may not get you the full benefit.

To calculate the repayment as a deduction, (Method 1):

Federal taxes - Deductions & Credits - Check for More Tax Breaks - Other Deductions & Credits - Show more - Other Deductible Expenses
When you get to the screen that shows Less Common Expenses, click No
The next screen will have Any Other Deductions? at the top. Please answer YES to "Did you have any other deductions that are not subject to the 2% limitation?"
Please enter the amount you repaid under, "Claim of Right Repayment (Only if over $3,000).

To explore the more complex route of calculating the credit (Method 2), please refer to IRS Publication 525 (https://www.irs.gov/pub/irs-pdf/p525.pdf)

NOTE: If you choose to follow the more complex route and use the credit:

You will need to use the Desktop version of TurboTax (available here: https://turbotax.intuit.com/personal-taxes/cd-download/)
The amount of the credit can only be entered in the Forms mode
Any entries made directly into forms will waive the Accuracy Calculations Guarantee (https://turbotax.intuit.com/corp/guarantees.jsp)