Hi. If the 2020 tax return had a self employment tax
deferral amount to be paid later. After it is paid, should
an entry be made into TurboTax 2021 as an estimated tax
entry for the amount paid to avoid having TurboTax pull in
the 2020 tax file with the deferred amount which is shown
as unpaid?
Hi. If the 2020 tax return had a self employment taxIt's too soon to know what TurboTax 2021 will do with the
deferral amount to be paid later. After it is paid, should
an entry be made into TurboTax 2021 as an estimated tax
entry for the amount paid to avoid having TurboTax pull in
the 2020 tax file with the deferred amount which is shown
as unpaid?
deferred self-employment tax. For that matter, we don't yet
know whether the IRS forms for 2021 will have any place to
carry over or reconcile the deferred self-employment tax. I
would assume that they will handle it appropriately, and not
treat it as tax due on the 2021 tax return. It might not
appear on the 2021 tax return at all.
I certainly would not enter the payment as an estimated tax
payment for 2021, because that's not what it is. Entering it
as an estimated tax payment would make the tax calculation
on the 2021 tax return incorrect, resulting in an IRS notice
with an additional payment due, plus penalties and interest.
Wait for guidance when the 2021 forms and software are
available.
Bob Sandler
It's too soon to know what TurboTax 2021 will do with the
deferred self-employment tax. For that matter, we don't yet
know whether the IRS forms for 2021 will have any place to
carry over or reconcile the deferred self-employment tax. I
would assume that they will handle it appropriately, and not
treat it as tax due on the 2021 tax return. It might not
appear on the 2021 tax return at all.
It's too soon to know what TurboTax 2021 will do with the
deferred self-employment tax. For that matter, we don't yet
know whether the IRS forms for 2021 will have any place to
carry over or reconcile the deferred self-employment tax. I
would assume that they will handle it appropriately, and not
treat it as tax due on the 2021 tax return. It might not
appear on the 2021 tax return at all.
It turns out that the IRS has recently posted DRAFTS of Form
1040, Schedules 1, 2, 3, and Schedule SE for 2021. I don't
see anything about the deferred self-employment tax on any
of those draft forms. Of course these are just drafts, but
it seems likely that the deferred tax is not going to be
shown anywhere on the 2021 tax return. That makes sense,
since the payment is due by December 31, 2021, and you
wouldn't be filing your 2021 tax return until after that. So
it looks like payment of the deferred tax will be handled
outside of the tax return.
Bob Sandler
You won't find it on the 1040 because the employer is responsible for >withholding the amount from the employee's 2021 wages and remitting it
to the IRS. The employer is also responsible for remitting the deferred
taxes for employees who are no longer employed.
On 8/2/21 4:45 PM, Bob Sandler wrote:
It's too soon to know what TurboTax 2021 will do with the
deferred self-employment tax. For that matter, we don't yet
know whether the IRS forms for 2021 will have any place to
carry over or reconcile the deferred self-employment tax. I
would assume that they will handle it appropriately, and not
treat it as tax due on the 2021 tax return. It might not
appear on the 2021 tax return at all.
It turns out that the IRS has recently posted DRAFTS of Form
1040, Schedules 1, 2, 3, and Schedule SE for 2021. I don't
see anything about the deferred self-employment tax on any
of those draft forms. Of course these are just drafts, but
it seems likely that the deferred tax is not going to be
shown anywhere on the 2021 tax return. That makes sense,
since the payment is due by December 31, 2021, and you
wouldn't be filing your 2021 tax return until after that. So
it looks like payment of the deferred tax will be handled
outside of the tax return.
Bob Sandler
You won't find it on the 1040 because the employer is responsible for withholding the amount from the employee's 2021 wages and remitting it
to the IRS. The employer is also responsible for remitting the deferred
taxes for employees who are no longer employed.
See https://www.irs.gov/newsroom/what-employers-need-to-know-about-repayment-of-deferred-payroll-taxes
On 8/2/21 4:45 PM, Bob Sandler wrote:
You won't find it on the 1040 because the employer is responsible for withholding the amount from the employee's 2021 wages and remitting itIt's too soon to know what TurboTax 2021 will do with the
deferred self-employment tax. For that matter, we don't yet
know whether the IRS forms for 2021 will have any place to
carry over or reconcile the deferred self-employment tax. I
would assume that they will handle it appropriately, and not
treat it as tax due on the 2021 tax return. It might not
appear on the 2021 tax return at all.
It turns out that the IRS has recently posted DRAFTS of Form
1040, Schedules 1, 2, 3, and Schedule SE for 2021. I don't
see anything about the deferred self-employment tax on any
of those draft forms. Of course these are just drafts, but
it seems likely that the deferred tax is not going to be
shown anywhere on the 2021 tax return. That makes sense,
since the payment is due by December 31, 2021, and you
wouldn't be filing your 2021 tax return until after that. So
it looks like payment of the deferred tax will be handled
outside of the tax return.
Bob Sandler
to the IRS. The employer is also responsible for remitting the deferred
taxes for employees who are no longer employed.
See https://www.irs.gov/newsroom/what-employers-need-to-know-about-repayment-of-deferred-payroll-taxes
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