TurboTax Update - Taxable Social Security Calculation Not Correct?

[jmosner]

Did the IRS or Turbotax give you any additional information such as why the social security calculation was incorrect? Did it have to do with unemployment? If so, was it because Turbotax included the unemployment received even though on the worksheet for IRS it did not?

[Oreoeater]

IRS is rejecting my 2021 return and says the calculations for the Social Security overpayment is not correct. I double checked all the W-2s and all information was entered correctly. I do NOT have any unemployment issues or payments.  I have encountered alot of bugs this year - never had a problem in the last 15+ years!

[JulieS]

When the IRS says your Social Security overpayment is not correct, it means that you are married fining jointly and at least one of your W-2 forms is listed under the wrong spouse. 

Please go back and review your W-2 forms and make sure they are not only correct, but that the employee name is correct. 

[VolvoGirl]

@Oreoeater   Do you mean the IRS adjusted your refund?

You only get excess SS back if one person had more than 1 employer and those employers took out more than the max of  $8,853.60 (for 2021).  Check 1040 Schedule 3 line 11 for it.  Then Schedule 3 goes to 1040 line 31.

Are you married and filed Joint?  And you both had W2s?  The IRS is probably right.  They usually are in this case.  You assigned both spouse's W2 to the same person so it looked like that person went over the max.

For 2021, Do you still have copies of all the W2s?  Look at box 4.  Did either of you have more than 1 employer?  You only get excess SS back if one person had more than 1 employer and those employers took out more than the max of  $8,853.60.  So add up your W2 box 4.  Is it more?  Then add up your spouse's W2 box 4.  Is their box 4 more than $8,853.60?

Or check W2 box 12.  You may have entered Code A by mistake.

[Chrys1]

You are correct. The irs told me to exclude it. Do not listen to turbo tax because their software is completely wrong in calculating the exclusion and social security. File an amended return and send it in. I sent mine in and they have approved the exclusion of the )10,200 so do not listen to those who have no clue. Hope you can get the refund you deserve and file the amended return. It took me a solid 14 months to finally get someone at turbo tax to show me how to amend the return accurately. 

[SDun12]

I think you may be commenting on the wrong thread @Chrys1  this isn't about excluding social security.  and there is no 10200 exclusion of social security.  last year there was an exclusion of that amount for unemployment but that has nothing to do with this thread.  

[Chrys1]

I was in a thread discussing the exclusion with ssi and unemployment for 2020. Someone asked what they need to do. I replied to her comment. No clue where the screwed up turbo tax software put it. I did my part correctly

[tiutniwantsdata]

I'm doing 2022 taxes (today is 15 April 2023). The taxable social security calculator for 1040 form is seriously screwed up IMO. It doubles the SS amount received. It is wholly inconsistent with the IRS pdf form available here:

https://img1.wsimg.com/blobby/go/35e70200-9d7d-4401-b45f-7c8d57460c76/downloads/Social%20Security%20...

Assuming I'm correct, the above is a serious error in the 2022 1040 Turbotax software. What the TT calculator does is DOUBLE the SS amount before figuring the calculable amount. This is ridiculous, and as I note, not what the IRS available worksheet does.

[DoninGA]

@tiutniwantsdata Where are you seeing a doubled SS benefit amount?

What is shown on the Form 1040 Line 6a?

If using the TurboTax online editions -

Click on Tax Tools on the left side of the online program screen. Click on Tools. Click on View Tax Summary. Click on Preview my 1040 on the left side of the screen.

[tiutniwantsdata]

The "Social Security Benefits Worksheet" in Turbo Tax directs that the number in box 5 of SSA-1099 ("Total net benefits from Box 5 of all SSA-1099 forms") be put on BOTH line A and line F.

Line F is an exact repeat of Line A. If line F is supposed to be a total of lines A through E, it does NOT say that, and the worksheet does not automatically bring the number down. This is really poor form design.

Moreover, even when I leave line F empty, the rest of the worksheet comes up with a number $2,175 higher as taxable SS income than the IRS worksheet I downloaded ("Social Security Taxable Benefits Worksheet (2022)").

This misleading if not outright incompetent form work makes me question the accuracy of everything else in the software. I have been doing my own taxes for years (I'm an attorney, but I don't practice tax law [god forbid]); I have been using this software since it was MacInTax, and I find it has become increasing difficult to use. The cross linkages are less intuitive and mistakes like the above are easy to make and miss.

[tiutniwantsdata]

The very first line ("1") of the worksheet below lines A through F is

"Add amounts from line A and F above." That doubles the amount.

[VolvoGirl]

The Turbo Tax worksheet should be right.  But you need to check the actual 1040 return line 6a and 6b.  6a should be the benefits in SSA-1099 box 5.  Is 6a doubled?  Then line 6b is the taxable amount up to 85% max of 6a.

You should not use the worksheet on the back of the SSA-1099.  It can be complicated to figure out even though it looks simple.  Turbo Tax figures it all out for you.

When you enter 1/2 of your ss on line B it is not being subtracted from anything.  It is being ADDED to ALL your other income to see if any of the ss will be taxable to you.

[tiutniwantsdata]

No, 6a is not doubled. The problem is the taxable amount, not the total amount. The TT worksheet is the problem as I described.

I did not use "the worksheet on the back of the SSA-1099." My SSA-1099 has no such worksheet. I used the worksheet the IRS has posted. I put a link to it in my first comment on this problem. IMO, it's not that complicated, and TT form gets it wrong it even when I don't double total amount.

Your last paragraph is exactly what IRS form does.

I have no time or interest (or skill!) to figure where the problem is in TT worksheet that it gives me a taxable amount almost 10% higher than IRS form. Here's screen shot of key rows in IRS worksheet:

[tiutniwantsdata]

Correction. There is a worksheet on back of SSA-1099 (it was folded over). I did not use it.

[tiutniwantsdata]

More correction. I did make a mistake in taxable SS worksheet from IRS; answer is the same I get from using TT after ignoring bad instructions.

Notwithstanding my error, TT is not being as easy to use as it used to be. In addition to bad form for taxable SS calculation, the links between cells on 1040 and other forms and worksheets do not work well; they go to another version of the form and make me hunt for a cell that will take me to the worksheet to feed the number back to the form. What happened to easy-to-use software?