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October 11, 2022
Question

SSDI Lump Sum Claim of Right for Colorado

  • October 11, 2022
  • 1 reply
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In 2021 I received my SSDI lump sum for 2019-2021.  I had to pay back my LTD carrier all the SSDI money I received for 2019 through 2021 thus changing how the money is taxed for those years.  Using previous posts from this site, I performed an analysis to compare tax using the income method and credit method.  The credit method yielded a more tax friendly solution, so I applied the credit to line E Claim of Right, IRC 1341 credit for repayments of prior year income on my Federal return.  The problem I have is that I can't find anywhere on my Colorado tax form to apply the State credit.  That credit is for over $2K because Colorado has a $20K exemption for SSDI revenue.  Also, note that I have not received an SSA-1099 for 2021 so I have to estimate how much was applied to each year and I only used the 2021 amount for 2021 even though I expect box 5 on the SSA-1099 probably includes the entire amount.  The lack of the SSA-1099 for 2021 is not a matter of not getting a copy.  The statement has not been created by the SSA and the current date is 10/10/22 (I filled an extension).

 

Summarizing the questions:

1.  How do I take a Claim to Right credit on the Colorado return.

2.  Since the SSA-1099 has not been created, should I estimate the values or wait for the 1099 to be created and modify the tax return if it's ever created.  If I wait, I'd get a large refund now and then will have to pay a large amount once I get the 1099 and file an amended return which I'm sure will include penalties.

       

1 reply

Employee
October 11, 2022
SteveB16Author
October 14, 2022

Support couldn’t solve this problem.  Since I only use the desktop version, I wasn’t given access to an expert.