SSA over payment Question

homebrew7

I paid back Social Security $8,000 in 2023. But i received the money from ssa in 2022 and it was caimed as income in 2022. How do I deduct the money I paid on this year taxes (2023).

KeriC

It sounds like you will either want to claim a deduction for the repaid amount or you will want to include a Claim of Right Repayment Credit on your 2023 tax return since you had to repay over $3,000 that you included in your income in an earlier year.

If you itemize your deductions, you can claim the repayment as part of your itemized deductions. The menu path to enter this in our software is:
Deductions/Credits > Other Itemized Deductions. You may then select Claim Repayments from the dropdown list.

If you won't be itemizing, you can instead claim the credit. The menu path for the credit is:
Deductions/Credits > Claim of Right Repayment Credit (under the Other Deductions/Credits heading).

To calculate the credit:

1. Recalculate your tax from the prior year without including the income that was repaid in the current tax year.
2. Subtract your recalculated prior-year tax from the tax shown on your prior-year tax return. This is the amount of your repayment credit.

You can't claim both a credit and a deduction for a repayment. You may choose whether to claim the credit or a deduction for the repayment, depending on which one is most beneficial for you.

homebrew7

Thank you that's what I was looking for. The funny thing is I did that last year. Just to see how much I overpaid in taxes. Don't remember what the amount was but it was enough to **** me off.

Again thank you

Scott