Turbotax asked me if I was wanted to defer the self-employment tax payment, I said yes. My tax return doesn't show that, how do I defer, do I just short-pay the amount?

[d-taylor]

thew return shows my full liability for April 15th and the payment voucher created has the same amount.  I found and verified in the instructions/worksheet that I am eligible but don't want to short pay any amounts the IRS may be expecting.

[JamesG1]

The Self-employment Tax Deferral is reported on the 2020 Federal 1040 tax return on line 31.  Are you seeing the deferral there?

Do not short-pay but report the tax deferral in TurboTax Online Self-Employed by following these steps. 

• Down the left side of the screen, click on Federal.
• Across the top of the screen, click on Deductions  & credits.
• Under Your tax breaks, scroll down Tax relief related to COVID-19.  Click Show more to the right.
• Click on Start / Revisit to the right of Self-employment tax deferral.
• At the screen Do you want more time to pay your self-employment tax?, click Yes.
• At the screen Let's start by getting your eligible income, enter an eligible self-employment income
• Click on Continue.
• At the screen Tell us how much you'd like to defer, enter the dollar amount.
• Click Continue.
• Click through Federal Review to make sure than the Review issue has been removed.
• At the screen Some of your self-employment taxes may be eligible, click Skip.

[d-taylor]

Hi JamesG1,

I believe I followed the steps you outlined in your thorough response, thank you.

I did not have any Review error for my return and I have already filed.  I did that several weeks ago, and was surprised I cold not find any payment direction from TT reflecting the intent to defer the SE taxes.

I suppose at this time, as there is no indication within what I filed regarding the deferral I am better off just paying the full tax due by the 15th of next month, would you agree?

Please advise.  Thank you.

[JamesG1]

@d-taylor

I agree, if you can afford to make the payment now, make the payment now.  We never know what the future might bring.

The self-employment tax deferral is an optional benefit.  It is not forgiveness, so those amounts will eventually need to be repaid. Half of the deferred amount is due on December 31, 2021, and the other half is due on December 31, 2022.

If you have employees, you can defer the 6.2% employer portion of Social Security tax for March 27, 2020 through December 31, 2020. Self-employed taxpayers can also postpone the payment of 50% of the Social Security portion of their self-employment tax for the same period.

See also this TurboTax Help.

[d-taylor]

JamesG1,

thank you for your expertise and advice.  I have a better understanding of the situation.  

What I need to understand is the way TT processed the information and what the final tax forms and vouchers are telling me in the face of this potential deferral (it's not mentioned though it is recorded one the 1040 as you indicated).

I will reach out to them for that answer.

Have a great day!

Regards,

Doug