SSA lump-sum for previous year question in tax declaration

[Marybell]

Jurisdiction

Kansas

Hello,
My husband applied for retirement in November 2019. They attempted to send his first payment in December 2019 but it went to the wrong account due to error and was returned to SSA. Then, at the beginning of January 2020 my husband passed away. I also care for our child under 16, so I qualified for SSA benefits. The first payment they sent to me was in March and it included his pension while he was alive, death benefit, and money they owed to me up to date (so it was like a lump-sum). After that, I began to get monthly payments. Our child also receives SSA benefit.
I am filing 2020 taxes and have our SSA-1099 forms. My understanding is that child's payment don't get entered to tax declaration at all.
The question I am not sure about is :
"We need to know if YOU received any lump-sum Social Security payments in 2020 for 2019 or earlier" and then they ask for that lump-sum amount.
I am attaching the forms without personal info, should I enter both amounts that are asterisked (on the bottom left) or not?
PS I have no idea why I have payments "repaid to SSA" - tax declaration asks for "box 5" only anyway. Thank you!

 

[Tax Counsel]

Hello,
Then, at the beginning of January 2020 my husband passed away.

Are you filing a joint return with your deceased for 2020 or a separate return? And who is asking you these questions? Are you using some kind of tax software to do the return?

 

[Marybell]

Are you filing a joint return with your deceased for 2020 or a separate return? And who is asking you these questions? Are you using some kind of tax software to do the return?

thank you for your reply. Yes I am filing Married Filing Jointly, because my husband was alive part of 2020 (not a huge part, but still). I am using TurboTax as part of IRS FreeFile program

 

[Tax Counsel]

thank you for your reply. Yes I am filing Married Filing Jointly, because my husband was alive part of 2020 (not a huge part, but still). I am using TurboTax as part of IRS FreeFile program

Ok then you'll need to enter the 1099-SSA for both you and your late spouse. I've not used the free file version of Turbo Tax but I imagine it's pretty similar to the version I am familiar with and the program will ask you to enter each of the 1099-SSA for you and your husband separately.

 

[Marybell]

Ok then you'll need to enter the 1099-SSA for both you and your late spouse. I've not used the free file version of Turbo Tax but I imagine it's pretty similar to the version I am familiar with and the program will ask you to enter each of the 1099-SSA for you and your husband separately.

thank you Tax Counsel. Yes, I am entering them separately, however, net amount for my husband is zero, because his payment was returned to SSA. (I am entering zero under his name)
The question I am not sure about is different:
The program asks: "We need to know if [my name here] received any lump-sum Social Security payments in 2020 for 2019 or earlier", if so, "please enter the amount of such lump-sum"

In the forms, I am looking at the left bottom portion where it says
* Includes $ X, paid in 2020 for 2019 - this is what is causing me a problem

However, in the description of the box 3 of the SSA-1099 forms, it says that the whole amount was "Benefits for 2020" which is somewhat confusing me

 

[Tax Counsel]

However, in the description of the box 3 of the SSA-1099 forms, it says that the whole amount was "Benefits for 2020" which is somewhat confusing me

Assuming that all the Social Security you received in 2020 is shown on the Forms 1099-SSA then all you need to do is enter the amounts from each box when the program prompts for it. Any benefits received in 2020 are included in your return for 2020 even if they were for some period in 2019.

Repayments to SSA made in 2020 reduce 2020 benefits, but again if the repayments are shown accurately on the Form 1099-SSA then you just provide the figure from that box when the program asks for it.

 

[Marybell]

Tax Counsel, thank you very much! Yesterday I talked to a friend who is an accountant in another state and prepares taxes. She asked me for all my numbers over the phone so that she can enter them into her program (just to see if she's getting the same as I do), we had two differences in results:
Child and other dependent Credit
She said I should get $2000 tax credit (that's what she sees in her program), while in my program child credit is $1400 (last year it was $2000), The child is 16.5 years old

I haven't received the second stimulus. My program adds $1800 for this missed stimulus (for 3 people, one of which is deceased husband) while her program only gives $1200 (for 2 people)

Do you have any thoughts about these two things (why we get them differently)?