Social Security - Lump sum or a repay

[Mark1954]

SS had reduce my SS payments in 2017 for money they told me I was overpaided in 2016.  But for whatever reason a year later they then deposited the $2337 as an extra deposit and I reported on my 2018 Taxes as a lump sum payment.  

I recently received my 2019 SS1099 which has note on bottom $2337 paid in 2019 for 2016. Seems I was using date in my checkbook (12/31/2018) from text message received by bank when doing 2018 taxes. After reviewing bank statement for that period it was officially deposited in my account on the 2nd of Jan 2019 and I'm guessing should have report it in this year tax?

Now I found out it was not a lump sum payment but a repay? Aren't they the same? Do I need to correct 2018 taxes? Report on my 2019 taxes?

[BarbaraW22]

In your case, this would be considered a lump-sum payment. A lump-sum payment is a one-time Social Security payment that you received for prior-year benefits.

Yes, you will need to amend your 2018 tax return and remove the amount of the lump-sum payment reported. Per this IRS Article, you must include the taxable part of a lump-sum payment of benefits in the year it is received. Therefore, you will need to include this income on your 2019 tax return.

However, you can elect to calculate the taxable portion of your 2016 lump-sum payment using your income from 2016 instead of your 2019 income. TurboTax can help you with this calculation. When you are in the Social Security section, the program will ask "Did you receive any lump-sum payments?" Select Yes and follow the instructions.

Please see this TurboTax Article for more information.