Social Security Tax Withholding: The Basics
Most employers are required to withhold Social Security tax from your wages. Keep in mind some government employers at the federal, state, and local levels may be exceptions.
If you're a railroad employee, your employer will withhold Tier 1 and Tier 2 RRTA taxes. Tier 1 covers Social Security and Medicare benefits, while Tier 2 is for private pension benefits.
What if Too Much Was Withheld?
Employer Errors
Oops! If a single employer withheld too much Social Security, Tier 1 RRTA tax, or Tier 2 RRTA tax, you can't claim it as a credit on your tax return.
Instead, your employer should fix the error. If they don't, you can file Form 843, Claim for Refund and Request for Abatement, with copies of your Form W-2, Wage and Tax Statement.
Multiple Employers
Working more than one job can have its perks, but it can also lead to overwithholding! If your total wages from multiple employers exceed the wage base limit for the year, you may have paid too much Social Security or Tier 1 RRTA tax.
Good news! You might be able to claim the excess as a credit on your tax return. Check out the "Excess Social Security and tier 1 RRTA tax withheld" section in the Instructions for Form 1040 (and Form 1040-SR) for the details.
You may be entitled to a refund if:
You paid excess Tier 1 RRTA tax over the Tier 1 RRTA compensation base.
You paid excess Social Security tax over the Social Security wage base.
You paid both Tier 1 RRTA tax and Social Security tax, and the combined amount exceeds the Social Security wage base.
If you had multiple employers and too much Tier 2 RRTA tax was withheld, use Form 843 PDF to request a refund. Don't forget to attach copies of your Forms W-2!
Filing Jointly
If you're filing a joint return, you and your spouse must calculate any excess Social Security tax or Tier 1 RRTA tax separately.