Turbo tax is saying that my employer withheld too much Railroad Retirement Tier 1 and that they owe me a refund. That is wrong and its messing up the rest of my taxes

Forum|Forum|5 years ago
April 12, 2021
2 replies
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they're telling me to contact my employer for a refund. the software is wrong and i've paid the correct amount into RRRT1.

TurboTax Free Edition Online

sls50211

Enter your Railroad Retirement Tier 1 amounts in box 14 of the W-2. Do not enter it box 4 for Social Security withholdings. In box 14, enter the description, amount, and select the category drop down then scroll to Railroad Retirement Tier 1. Additionally, you will need to enter in box 14 the Railroad Retirement compensation amount from box 1 of the W2 so the overpayment is not reported. Select "Railroad Retirement Compensation" from the box 14 category.

Click here for more information on entering Railroad Retirement information in TurboTax

Your Tier 1 taxes should 7.65% of your compensation, The maximum wages Social Security tax portion (6.2%) is 137,700. There is no maximum on the Medicare portion (1.45%). The Tier II tax is 4.9% with maximum wage amount of 102,300. You might be able to back into the amount of your taxable compensation by using the Tier I percentages. From there you can look at reported wages on your W-2 and box 12 and box 14 come to a total that will equal the calculated amount. The only variable would be if your compensation is over 137,700. Otherwise you can divide your Tier I taxes by 7.65% to get to your taxable compensation amount then go from there.

mdibenedettoAuthor

Employee

yeah the turbo tax software is wrong this year, i had no issues last year but this year its saying they withheld too much which is wrong. which is holding me up from filing

awb811

Correct i Have rail road taken out from railroad carrier and Union which i work for It is an overpayment on my part due back to me Like guy said Turbo tax always refunded this to me from railroad retirement. Need an update.!!!!

Port53

TurboTax is still incorrectly reporting "Your employer withheld too much Railroad Retirement Tier 1 tax from you wages 2023

This came up after entering my W-2 and the railroad retirement tax was entered in box 14.

When are you going to fix this bug that has been around for at least three years.

DaveF1006

You received the error message because the amount on Line 14 is greater than allowed, but entering the information below will allow your railroad income to be properly reported.

TurboTax recognizes the codes Tier 1 and Tier 2 in box 14 of your W-2, so you only need to choose these codes from the drop-down menu in Box 14. They are near the bottom of the list. Look for ''Railroad Retirement Tier 1 Tax'' and below that is ''Railroad Retirement Tier 2 tax''. TurboTax will properly report and apply these amounts on your tax return.

ADD another line 14 entry with the same amount as in Box 1 Wages. Select code - "Railroad Retirement Compensation." Code RR.

@Port53

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Port53

David Here is a screen shot of what I entered. For MED i selected Category "Railroad Retirement Medicare"

TEIR2 category is "Railroad Retirement Tier 2 Tax" and TEIR1 category is "Railroad Retirement Tier 1 Tax"

I click continue and it asks to check local taxes, I live in WA state so no local taxes. I then hit Continue and the screen comes up "It looks like you're due a refund from your employer....."

Are you saying to add another line that does not exist on my W-2 form? How would someone know to do this if the line does not exist on the W-2?

I followed what you said to add "Railroad Retirement Compensation." Code RR and I get the same "It looks like you're due....." screen