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Old 08-14-2015, 11:14 AM
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Question federal and state withholding

I have an unusual situation so bear with me. I received a bonus last year in December 2014 which was incorporated into my regular pay check. I wasn't supposed to get the bonus because of paperwork that got screwed up by my payroll office. By the time the payroll office figured this out it was in January 2015. They asked for this money to be returned. No problem because I held on to the money knowing they were going to ask for the excess money. Here's where the problem comes in, social security, medicare, federal and state withholding was taken from this money. The social security and medicare was able to be recaptured by the payroll office but not the federal and state withholding. I paid the money back in 2015 but the federal and state withholding was taken in 2014. How do I recapture these taxes because the money I paid back was not subtracted from my 2015 YTD salary which would have made a difference in my AGI for 2015 which then in turn would have then taken care of this tax situation. My payroll says they're not able to subtract that paid back money from my 2015 YTD salary. Payroll office says see a tax accountant. Does anyone have an answer to this tax situation?



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Old 08-14-2015, 02:04 PM
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I have an unusual situation so bear with me. I received a bonus last year in December 2014 which was incorporated into my regular pay check. I wasn't supposed to get the bonus because of paperwork that got screwed up by my payroll office. By the time the payroll office figured this out it was in January 2015. They asked for this money to be returned. No problem because I held on to the money knowing they were going to ask for the excess money. Here's where the problem comes in, social security, medicare, federal and state withholding was taken from this money. The social security and medicare was able to be recaptured by the payroll office but not the federal and state withholding.====>>I guess so, since you worked for one ER and it withholds an incorrect amount of Social Security taxes, you usually need to ask your ER to correct its error and refund the overpayment. However, in general, you cannot claim the overpayment on your income tax return and receive a refund from the IRS/your state.

As mentioned above; The Social tax credit is much like the amount of payroll taxes your ER withheld; it is a credit toward your potential tax liability. Aslongas your total tax credits are more than your tax liability, you will receive a refund. If your tax liability is higher than what your credits, you will need to pay the difference, even if you have a Social tax credit. However, You cannot claim the overpayment on your federal/ state income tax return and receive a refund from the IRS/your state.



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Old 08-19-2015, 12:14 PM
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What do you mean by ER? What do you mean by Social tax credit. I'm somewhat confused by the terminology and I'm trying to get a better understanding of what you are trying to explain. Is there anything special I need to do on the 1040?



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Old 08-19-2015, 01:43 PM
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Originally Posted by TonyL View Post


#1;What do you mean by ER? What do you mean by Social tax credit. I'm somewhat confused by the terminology and I'm trying to get a better understanding of what you are trying to explain.




#2 Is there anything special I need to do on the 1040?
#1;Sorry my bad form the terminology; ER means Employer; EE means Employee;
social tax credit means Scoial security tax, I mean fica tax, refund; as said, you need to ask your ER, employer, to correct its error and refund the overpayment of social sec taxes withheld from the bonus.


#2; No I do not think so; As mentioned previously, only on your 1040/state return, you can receive a refund from the IRS/your state.



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Old 09-01-2015, 09:48 AM
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Originally Posted by TonyL View Post
What do you mean by ER? What do you mean by Social tax credit. I'm somewhat confused by the terminology and I'm trying to get a better understanding of what you are trying to explain. Is there anything special I need to do on the 1040?
I think I need to provide real numbers in this situation so it may make more sense. The bonus over payment was $2,916.97. After my ER was able to retrieve the social security and medicare taxes I paid back $2,671.25. Federal & State taxes were not able to be retrieved. So how and where do I post the $2,671.25 on my 2015 1040 so it it gets deducted from my AGI since it was added in my AGI for 2014? Does my ER need to provide any additional documents to me that I paid them $2,671.25 that I can use on the 2015 tax return?



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Old 09-01-2015, 03:35 PM
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Originally Posted by TonyL View Post
I think I need to provide real numbers in this situation so it may make more sense. The bonus over payment was $2,916.97. After my ER was able to retrieve the social security and medicare taxes I paid back $2,671.25. Federal & State taxes were not able to be retrieved. So how and where do I post the $2,671.25 on my 2015 1040 so it it gets deducted from my AGI since it was added in my AGI for 2014? Does my ER need to provide any additional documents to me that I paid them $2,671.25 that I can use on the 2015 tax return?
I think I need to provide real numbers in this situation so it may make more sense. The bonus over payment was $2,916.97. After my ER was able to retrieve the social security and medicare taxes I paid back $2,671.25. Federal & State taxes were not able to be retrieved.===>Correct; That what I mean. You need to get refund when you file your 1040 for 2015 reutrn due by Apr 15 of 2016 as you said,” . .. the payroll office figured this out it was in January 2015.”.” However, You cannot claim the overpayment on your federal/ state income tax return and receive a refund from the IRS/your state.”

So how and where do I post the $2,671.25 on my 2015 1040 so it it gets deducted from my AGI since it was added in my AGI for 2014?====>> The federal portion of $2,671.25’d be reported on the year 2015 form 1040 line 64 ; you can check the line number when IRS publishes 2015 1040. However as you know, you MAY claim your state income tax on Sch A of 2015 1040 aslongas you itemize deductions on your return. And also you may report your sate tax on your state return form in appropriate line on your state return form. If you itemize your state tax ion your Sch A of 1040 on your 2015 return then you perhaps NEED to add it to your 2016 state reutn I GUESS. please contact the DEPT of REV of your state for more info in detail.


Does my ER need to provide any additional documents to me that I paid them $2,671.25 that I can use on the 2015 tax return?==>>That is NOT bad as there is no penalty in submitting a statement to explain your situation; I guess it is good idea.



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Old 09-01-2015, 04:41 PM
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Originally Posted by TonyL View Post
I think I need to provide real numbers in this situation so it may make more sense. The bonus over payment was $2,916.97. After my ER was able to retrieve the social security and medicare taxes I paid back $2,671.25. Federal & State taxes were not able to be retrieved. So how and where do I post the $2,671.25 on my 2015 1040 so it it gets deducted from my AGI since it was added in my AGI for 2014? Does my ER need to provide any additional documents to me that I paid them $2,671.25 that I can use on the 2015 tax return?
If you paid the fed/state taxes in 2014 then you need to amend your 2014 return due by Apr 15 2015;
April 15, 2018, is the last day to file your 2014 tax return to claim a refund; if you had an extension, your deadline is October 15, 2018.
your state income tax refunds may be taxable, depending on what you deducted on your prior-year tax returns. If you did not itemize deductions on Schedule A and took the standard deduction, then the state refunds are not taxable



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