PetrifiedExPat

Dear all,

I was hoping for some drama free time leading up to the end of the tax year.

I have been overpaid since I left my last position. Of course, I immediately declared it and await admin. instruction. However, the gross pay was separated into net pay, taxes and retirement (as would be normal).

How on earth do I sort the tax mess out of repaying the funds, whilst still having sent money to the IRS and State? How would I recover the money from my TSA (edit: I meant ROTH) account if the employer wants the gross amount back from me?

I hope that is all clear.

H

ian-mstm

And this was bad because... why?


Why? Why are you so sure that it's an error?

Ian

PetrifiedExPat

Hi Ian,

Yes definitely an error, my federal grant funding ran out at the end of October and I lost pay and benefits. I knew this about 4 months in advance. As much as the money is nice, it's not mine and I want to return it. Not sure I have any legal recourse to argue against it, in any case.

I wondered what broader implications there could be, once I return it. Can the employer, for example, adjust my w2 to reflect I repaid the money? It may be an easy process, I just don't know.

It was certainly an error though, the head admin. noticed the mistake he made in the system when he double checked it. How we proceed from here, I await to find out...

scrubbedexpat091

Anytime a company overpaid me, money was returned, company payroll issued a revised pay slip, and W-2 was fine and life went on as normal.

I'll add sometimes money was repaid simply with a deduction of the next check, not always in physically returning it myself.

ian-mstm

As Jsmth321 notes, your employer will simply issue an amended W-2 when the time comes, so there should be no tax issues at all. As for repaying, either they'll ask for the money back or they'll make some other arrangement with you. Bottom line, this is their mistake... let them suggest a way to fix it.

Ian

PetrifiedExPat

Hi,

A quick update. My employer (now past employer) has held onto the cheque to repay the net overpay for approx. 2 weeks, and it has only just made its way to payroll. As it stands there is no guarantee it will be cashed before 31st December.

Does this mean they will not adjust my W2 for this year? I no longer work for them, so will not receive a W2 for the next year either (from them).

I have reached the limit of my knowledge, tax wise, to deal with this situation. How can I reconcile the this issue for purposes of filing for 2016?

Thank you,

H

ian-mstm

They might... they might not. There's really no way to know for sure.


They are obligated, by law, to send you a W-2 by January 31.


One way or the other you'll get a W-2.

Ian

vikingsail

There mistake - there's to fix. Its called an employment contract for a reason. Should be able to get them to accomplish with kind words and a little gentle persuasion. If not, words along the lines of I will be hiring a professional at your expense to solve the issue usually seem to remedy such situations.

durham_lad

Whether or not they cash in the overpayment by December 31st I expect your W-2 end of January will be correct. If it is not correct then they should issue a corrected W-2 shortly after, and if it were me I'd insist they get it corrected because if it shows they paid you more than you received then you will have paid more taxes than you should have.

When you file your taxes you should always use the figures on the W-2. If a corrected W-2 arrives after you've filed then you can file a corrected return, it's no big deal. However, you have until April 18th before filing so plenty of time.

PetrifiedExPat

Hi,

I realize that my USA/UK history hasn't been overly clear from previous threads. Currently GC holder in the USA, having adjusted from H1B status. H1B period begun end of 2014. I have been in the USA ever since. All my tax questions relate to USA tax filing obligations. I had some FBAR requirements to catch up on, but a CPA helped me out with that a few months back.

EDIT: This was in response to the deleted comment above. It may seem a little out of context, now, although probably worth the clarification.