My Mother died 1/16/2020. Social Security had paid her benefits the first part of January. SS pulled her Jan payment back from her checking account. I get her SSA1099 today and it states she was paid and doesn't show any thing in box 4 for benefits repaid... I need to file her taxes for 2020 and this should not be counted as income. What should I do?? Thanks
Grrrrr - government. They sure do a poor job of explaining.
Notice the SSA1099 title - SOCIAL SECURITY BENEFIT STATEMENT. It reports benefits; not by payment date posted.
The January SSA PAYMENT for any year is actually the December BENEFIT of any year and is thus included in the SSA1099 for the December year. In your Mom's case it would have been included in her 2019 SSA 1099.
It is not the actual date paid but the month in which the payment is being used to pay. They can do this because they know the amount of BENEFIT that is being paid FOR the month of December of any year.
So the SSA1099 is based on the BENEFIT calendar year NOT when the payment actually hits the bank account (direct deposit) in January of any year FBO the preceding December of any year.
Then, in your Mom's situation, for the January 2020 BENEFIT, (which would have been paid in early Feb. 2020) - she was not alive for the entire month of January, and for benefit purposes that is the determining factor; so they took it back. The way I see it, there should be NO BENEFITS on the SSA1099 for tax year 2020 because she should not have received any BENEFIT for tax year 2020.
I don't understand why the January, 2020 benefit was pulled back. SS benefits are paid in arrears...meaning that the January, 2020 payment was the December, 2019 benefit. You must live the full month to obtain benefits; so if a benefit had been paid in February, 2020 (for January) that would have to be repaid.