W2-C

[Elsie]

I did my taxes in Turbo Tax Deluxe, did the steps, did the check, all good saved the file. Reopened  few days later wanting to file and went through the steps again and now it is saying based upon what I entered I am to expect a W2 C? why all of a sudden I didn't change anything, my only deferred Income is my 403B contributions as I have always had listed.

[TedK1]

I am in the same situation and have checked my W2 information, and have verified the SS withheld and entered is the total amount owed for the year, so I think it is a glitch in the Turbo Tax checking algorithm.  To check your amounts, Social Security withheld should equal 6.2% of social security wages; Medicare withheld should be 1.45% of Medicare wages.

[AlanT222]

You received the message in error.  You can proceed to file your taxes as normal.  

This message was intended for individuals who deferred Social Security and/or certain self-employment taxes. 

The issue has been resolved.  

The Coronavirus, Aid, Relief and Economic Security Act (CARES Act) allows employers to defer the deposit and payment of the employer's share of Social Security taxes and self-employed individuals to defer payment of certain self-employment taxes.  For more information on the Deferral of employment tax deposits and payments through December 31, 2020, click here.

Only customers who may legitimately receive a W-2C will get the pop-up.   

[JKD2020]

I am not sure it was fixed.  I received the same error though I did go ahead and file.  We did not defer out SS taxes nor are we self employed.

Will this cause errors at some future time?
Thanks,

Kerry

[Cynthiad66]

No.  This will not cause errors in the future since you did not defer your Social Security.

The Coronavirus, Aid, Relief and Economic Security Act (CARES Act) allows employers to defer the deposit and payment of the employer's share of Social Security taxes and self-employed individuals to defer payment of certain self-employment taxes. These FAQs address specific issues related to the deferral of deposit and payment of these employment taxes, as well as coordination with the credits for paid leave under sections 7001 and 7003 of the Families First Coronavirus Response Act (FFCRA) and the employee retention credit under section 2301 of the CARES Act. These FAQs will continue to be updated to address additional questions as appropriate.

Related Information

Deferral of employment tax deposits and payments through December 31, 2020

[benslow]

I've learned that based on the CARES act my employer chose to defer their SS and Medicare tax payment on a group life insurance policy (taxable income).    (found on the W-2 they sent- boxes 12b had code M and box 12c had code N. 

Does this mean the employee is impacted filing taxes? 

Does this mean that I will receive a W-2c for 2020 next year and that I will need to file a corrected 2020?  or even 2021 ?  since the CARES act allows employers under certain conditions to also defer payment to 2022 in some cases.

[KathrynG3]

The taxes that were not paid with Codes M and N will be paid on your tax return now. This will be seen on Schedule 2 and carried to Form 1040, Line 23.

Any adjustments would be reported in the year received and not require an amended 2020 tax return, but your taxes from Code M and N for 2020 will be paid for 2020 and reported as described above.

@benslow

[benslow]

I never see the forms until I complete  Turbotax Online. I see user friendly questions and $ boxes.  So I hope that you are saying that TT online will do the work for me and this will be seen on Schedule 2 and carried to Form 1040, Line 23 when I'm all done.

[DianeW777]

Yes, TurboTax will use the codes (M & N) to accurately populate the tax on your 1040 as indicated by @KathrynG3. 

• Code M: Uncollected social security or RRTA tax on taxable cost of group-term life insurance over $50,000 (former employees only). See "Other Taxes" in the Form 1040 Instructions. 
• Code N: Uncollected Medicare tax on taxable cost of group-term life insurance over $50,000 (former employees only). See "Other Taxes" in the 1040 Instructions.
  • TurboTax automatically pulls this amount to be included with the Total Tax 

This tax is common and usual for reporting on the W-2 by your employer.

[3074]

I received a W-2 for $1409 (the premium on group term life insurance).  Turbo Tax calculated over $1500 in unpaid SS and Medicare taxes.  This is greater than the W-2 amount.  The death benefit is $107,000.  Are the taxes calculated on the expected premium for $57,000 for a person of my age?

[ErnieS0]

The income is the value of group-term life coverage in excess of $50,000 in employees’ taxable income.

Your amount seems high for $57,000 which I assume is ($107,000 - $50,000). Perhaps your coverage amount is larger than the death benefit amount.

Consultancy Newfront has a nice explanation along with imputed income percentages at Group-Term Life – Imputed Income to explain how things are calculated.