How to File for a Social Security Tax Overpayment Refund

You can get a refund or credit for Social Security overpayments.
Image Credit: goir/iStock/Getty Images

Use Internal Revenue Service Form 843, Claim for Refund and Request for Abatement, to request a refund or credit if you paid too much Social Security tax. Certain railway workers who don't pay Social Security taxes also use Form 843 to claim any excess Railroad Retirement Tax Act tax withheld.

Social Security Taxes

Employers must withhold Social Security taxes and Medicare taxes, from every paycheck. As of 2015, the Social Security tax of 6.2 percent applies to the first $118,500 of annual taxable income, creating a maximum Social Security tax liability of $7,347. If you paid more than this amount, you qualify for a refund or a credit against future income taxes, depending on the reason for the overpayment. Use the worksheet for Excess Social Security—Nonrailroad Employees in IRS Publication 505 to figure the overpayment.

Multiple Employers

If you worked for multiple employers during the tax year, it's possible that the total Social Security tax withheld exceeded the maximum. Fill out Form 843, specifying the excess amount you that computed on the IRS worksheet and identifying the tax type as "Employment." Enter an explanation as to why you believe your request should be approved and show the computation you used to figure the excess amount you paid. You can't receive a refund for this type of error, but you can receive a credit against your future income tax obligations.

Error by Single Employer

If a single employer withheld too much Social Security tax, ask it to refund the excess to you. Only file Form 843 if the employer fails to make a full refund. Your explanation should include, if possible, a statement from the employer indicating any amount it has refunded to you and the employer's support for your request. If the employer will not provide the statement, enter the information you have available and include a copy of your IRS Form W-2 showing the amount of Social Security tax withheld. In this situation, you qualify for an IRS refund rather than a tax credit.

Logistics for Filing

You can download and print Form 843 from the IRS Forms and Publications website. Fill it out and mail it to the address listed in the form's instructions. If you qualify for a refund and don't receive it within six weeks, contact the IRS to have the status of the refund researched. If you and your spouse file jointly, you must each figure excess Social Security tax separately.