Retroactive SS benefits and lump sum worksheet

Forum|Forum|3 months ago
March 19, 2026
1 reply
6 views

I have a client who received retroactive SS benefits in 2025 to the tune of over $65,000 spread over 4 past years with his 2025 benefit of just over $34,000. I entered the entire $99,000 SS benefit from box 5 of the SSA-1099 in the SS worksheet. Then in the earlier year lump sum worksheet, I entered the required data for each of the 4 years. I don't see one dollar of tax difference. If they have this lumpsum worksheet shouldn't there be a benefit to completing it? What am I doing wrong? On the cumulation of the lump sum worksheet it shows taxable benefits under lump sum election: about $73,0000, while my 1040 line 6b for taxable benefits shows $61,000. Any advice or insight would be appreciated.

ProSeries Professional

Best answer by TaxGuyBill

@tammie wrote:

On the cumulation of the lump sum worksheet it shows taxable benefits under lump sum election: about $73,0000, while my 1040 line 6b for taxable benefits shows $61,000.

If the taxpayer had a moderate to high income on the prior tax returns, the Lump Sum option may not reduce the taxable amount.

At first glance, it looks like the Lump Sum calculations show it would be MORE taxable income ($73,000), likely due to HIGHER income in previous years, as compared to the 'regular' calculation ($61,000), likely due to lower income this year.

Does the higher income in previous years compared to lower income this year seem right? If so, it seems like the program is doing it correctly.

T

TaxGuyBillAnswer

Level 15

@tammie wrote:

On the cumulation of the lump sum worksheet it shows taxable benefits under lump sum election: about $73,0000, while my 1040 line 6b for taxable benefits shows $61,000.

If the taxpayer had a moderate to high income on the prior tax returns, the Lump Sum option may not reduce the taxable amount.

At first glance, it looks like the Lump Sum calculations show it would be MORE taxable income ($73,000), likely due to HIGHER income in previous years, as compared to the 'regular' calculation ($61,000), likely due to lower income this year.

Does the higher income in previous years compared to lower income this year seem right? If so, it seems like the program is doing it correctly.

T

tammieAuthor

Level 4

Yes, that is true--his income was higher in 2021 and 2022 due to employment and then he retired and his income decreased. It is also still reduced in 2025--ok, then it makes sense that the tax would not decrease with the lump sum. Thank you for reassuring me that I wasn't missing the key element.

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