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Self employment tax deferral

tscott1205
Level 4

Client filed his 2020 tax return. He owed s/e tax. He did not defer any of the s/e tax. Can he amend his 2020 tax return to defer the maximum amount.

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9 Replies 9
Just-Lisa-Now-
Level 15
Level 15

Did he have a refund on his 2020 return? 

If you end up with a refund they wont let you defer, they'll reduce the refund.


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tscott1205
Level 4

No refund. The taxpayer owed

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Just-Lisa-Now-
Level 15
Level 15
If they havent paid yet, I guess it may be possible to utilize the deferment.

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tscott1205
Level 4

Not sure if they have paid already or not. The return has been efiled and accepted

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tscott1205
Level 4

Can't find any reason why they can't amend.

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Just-Lisa-Now-
Level 15
Level 15
If they already paid, IRS wont refund it back and let it be deferred.

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tscott1205
Level 4

Don't sound fair

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qbteachmt
Level 15

"Don't sound fair"

It's not only fair, but provided to make it more fair.

That's not a Creditable Refund; it's a deferral for something not yet paid, so it isn't also considered past due.

It's part of parity for the Self-employed to be treated as employers are treated for the Form 7200 provision.

"Employers that have already deposited all or any portion of the employer's share of Social Security tax during the payroll tax deferral period may not subsequently defer payment of the tax already deposited and generate an overpayment of tax"

"Employers that have already paid the employer's share of Social Security tax on wages during the payroll tax deferral period may not subsequently defer the payment of the tax"

Remember that SE = both an employer and an employee for purposes of the Social Security tax.

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tscott1205
Level 4

Hasn't already paid but have already filed

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