Class Action W-2

[peggysioux5]

Taxpayer’s husband passed away several years ago.  2020, W-2 was issued under deceased spouse’s social security # with federal withholding due to class action suit.  Does taxpayer need to request for correction from W-2 in husband’s name to 1099 in taxpayer’s name and social?

Peggy Sioux

[Lee B]

I believe post death wages are supposed to be reported with a 1099 not a W - 2.

[Lee B]

4 hours ago, cbslee said:

I believe post death wages are supposed to be reported with a 1099 not a W - 2.

The reason is that post death wages are not subject to any employment taxes.

If the W 2 shows any employment taxes withheld those taxes should be refunded.

[peggysioux5]

Taxpayer does not want to request correction of deceased husband's W-2 even though W-2 was issued incorrectly with federal and state withholdings rather than correctly reporting on 1099 under taxpayer's social security #.  She said she did not want to go through the hassle and didn't care about getting corrected......so, should I include the the W2 income on taxpayer's tax return as "other income"???

Peggy Sioux

[Lee B]

Then it's part of his estate

[peggysioux5]

The deceased spouse died over five years ago and estate closed several years ago.  So, does another estate return need to be filed?

Peggy Sioux

[Lee B]

I don't know who the check was issued to, but it should have been issued the estate or to the beneficiary.

If it was not issued to the estate or the beneficiary, it should have been returned at that time and reissued.

If it wasn't, then you have what you have, in which case I would be tempted to just wait and see what happens.

 

[DANRVAN]

16 hours ago, peggysioux5 said:

, should I include the the W2 income on taxpayer's tax return as "other income"??

Since it appears surviving spouse has cashed the check and doesn't care about the withholdings, then why not?

In that case, it's probably not worth filing a 1041 to deduct the $600 exemption,  additional tax prep fees and income distribution back to surviving spouse.

I would be tempted to report other income at net, as that is all she received.

1 hour ago, cbslee said:

wait and see what happens.

Curious how that would work. 

CP 2000 to deceased and letter to explain it was reported by surviving spouse?

[schirallicpa]

Oh poor tax payer - isn't it just a pain to have to get paperwork corrected........Why is it always our problem to figure it out when the TP is too lazy to pursue the correction?