Excess Social Security Tax

Any tax mavens out there?

I recently changed employers and the new employer will of course start withholding starting from zero.  This will result in quite a bit of excess Social Security withholding toward the latter part of this year that I'd rather not wait until next year to recoup when I file my taxes.

I thought I might be able to adjust my Federal Income Tax withholding to offset, but the new W4 doesn't make that easy.

Anyone have any experience with this who is able to offer any advice?  

jimmurphy said:

Anyone have any experience with this who is able to offer any advice?  

Guess not. 

Call Soc. Sec.  I’m sure they’ve dealt with this before.

Not legal or accounting advice, but don't you get the excess social security back when you file your 1040?  If so, could you simply reduce your income tax withholdings by an amount equal to what you expect your FICA overpayment to be to balance it out?

Steve, exactly the goal, but the current W-4 is very specific about what you can subtract from income to reduce the withholding, and you're signing it "under penalty of perjury."  (They're pretty open to choosing extra withholding, though.) 

My guess would be that IRS would not examine the W-4 even if someone claimed deductions on it that were more than what showed up on the 1040, assuming the amount was not Huge and the 1040 was not way way underpaid, and probably not even then.  Personally though, i would probably not take the chance and would just grind my teeth while waiting till next spring for the refund.

Apollo_T also has a good idea imo - and if you don't like the first answer, call again....  Write down the agent's ID just in case, though IRS will not necessarily be bound by what they say.

eta a crucial "not" - "not take the chance"

Have you discussed the issue with HR at your new employment?

I haven't filled out a W-4 in over 25 years so I have zero recollection on what it says, though I thought it just asked for your deductions and/or additional withholdings.

Seems to me it used to ask a little vaguely about number of exemptions or whatever, but now it looks specific about how many dependents, expected amount of deductions/credits....

I don't think the IRS would care or even bother to examine a W-4 as long as the final withholding was consistent with your actual paid tax, and you weren't using a withholding amount to unfairly save on interest during the withholding period.  If I couldn't get hold of an IRS agent, I would be inclined to put in an amount that made sense, and not worry about it.

Thanks for the responses.

Yes, mjc nailed the problem.

Used to be that there was greater flexibility with the number of exemptions one could claim.  HR is of no help - they just refer to a tax advisor.

mjc said:

Seems to me it used to ask a little vaguely about number of exemptions or whatever, but now it looks specific about how many dependents, expected amount of deductions/credits....

I hope it's better than before, because I've never been able to get the withholding amount at the correct level until I started received paychecks and adjusted accordingly.