Table 3.1
3. Add lines 1 and 2. If $4,984.80 or less,
$36,200 working for Leather Design. Shoe Com-
stop here. You cannot claim the credit.
pany withheld $2,976 for social security tax.
Maximum
4. Social security and tier 1 RRTA tax
Leather Design withheld $2,244.40 for social
wages
Maximum
limit . . . . . . . . . . . . . . . . . . . . .
4,984.80
security tax. Because he worked for two employ-
subject
tax to be
5. Excess. Subtract line 4 from line 3. . .
ers and earned more than $80,400, he had too
Type of Tax
to tax Tax rate
withheld
Social security
$80,400
6.2%
$4,984.80
much social security tax withheld. Tom figures
Where to claim credit for excess tier 1 RRTA
his credit of $235.60 as follows:
withholding. If you file Form 1040A, include
Railroad employees
Tier 1 railroad
the excess in the total on line 41. Write “Excess
Filled-in Worksheet 3.1 for Tom Martin
retirement (RRTA)
$80,400
6.2%
$4,984.80
SST” and show the amount of the credit in the
(Example 3.4)
Tier 2 RRTA
$59,700
4.9%
$2,925.30
space to the left of the line. If you file Form 1040,
1. Add all social security tax withheld (but
enter the excess on line 62.
not more than $4,984.80 for each
You cannot claim excess tier 1 RRTA with-
Note. All wages are subject to Medicare tax
employer). This tax should be shown in
holding on Form 1040EZ.
withholding.
box 4 of your Forms W – 2. Enter the
total here. . . . . . . . . . . . . . . . . . . $5,220.40
Worksheet 3.3
Employer’s error. If any one employer with-
2. Enter any uncollected social security
held too much social security or RRTA tax, you
tax on tips or group-term life insurance
1. Add all tier 2 RRTA tax withheld (but
cannot claim the excess as a credit against your
included in the total on Form 1040, line
not more than $2,925.30 for each
income tax or file a claim for refund of the ex-
58 . . . . . . . . . . . . . . . . . . . . . .
0
employer). Box 14 of your Forms W – 2
3. Add lines 1 and 2. If $4,984.80 or less,
cess. Your employer must adjust this for you.
should show tier 2 RRTA tax. Enter the
stop here. You cannot claim the credit.
5,220.40
total here . . . . . . . . . . . . . . . . . .
4. Social security tax limit . . . . . . . . . .
4,984.80
2 Enter any uncollected tier 2 RRTA tax
Worksheet for Nonrailroad
5. Excess. Subtract line 4 from line 3. . .
$235.60
on tips or group-term life insurance
Employees
included in the total on Form 1040, line
58 . . . . . . . . . . . . . . . . . . . . . .
Worksheets for Railroad
3 Add lines 2 and 3. If $2,925.30 or less,
Unless you worked for a railroad during 2001,
stop here. You cannot claim the credit.
Employees
figure the excess on the following worksheet.
4. Tier 2 RRTA tax limit . . . . . . . . . . .
2,925.30
Worksheet 3.1
5. Excess. Subtract line 4 from line 3. . .
Publication 17 contains a worksheet on
1. Add all social security tax withheld (but
!
How to claim refund of excess tier 2 RRTA .
page 259 under How to figure the
not more than $4,984.80 for each
To claim a refund of tier 2 tax, use Form 843,
credit if you worked for a railroad. Do
CAUTION
employer). This tax should be shown in
Claim for Refund and Request for Abatement.
not use that worksheet if you are claiming a
box 4 of your Forms W – 2. Enter the
Be sure to attach a copy of all of your W-2 forms.
refund of excess tier 2 tax.
total here . . . . . . . . . . . . . . . . . .
2. Enter any uncollected social security
If you worked for a railroad during 2001,
tax on tips or group-term life insurance
figure your excess withholding on the following
included in the total on Form 1040, line
58 . . . . . . . . . . . . . . . . . . . . . .
worksheets.
3. Add lines 1 and 2. If $4,984.80 or less,
Worksheet 3.2
stop here. You cannot claim the credit.
4. Social security limit . . . . . . . . . . . .
4,984.80
1. Add all social security and tier 1 RRTA
5. Excess. Subtract line 4 from line 3. . .
tax withheld (but not more than
$4,984.80 for each employer). Social
Where to claim credit for excess social se-
security tax should be shown in box 4
curity withholding. If you file Form 1040A,
and tier 1 RRTA should be shown in
include the excess in the total on line 41. Write
box 14 of your Forms W – 2. Enter the
total here . . . . . . . . . . . . . . . . . .
“Excess SST” and show the amount of the credit
2. Enter any uncollected social security
in the space to the left of the line. If you file Form
and tier 1 RRTA tax on tips or
1040, enter the excess on line 62.
group-term life insurance included in
You cannot claim excess SST withholding on
the total on Form 1040, line 58 . . . .
Form 1040EZ.
Example 3.4. In 2001, Tom Martin earned
$48,000 working for the Shoe Company and
Page 36
Chapter 3 Credit for Withholding and Estimated Tax for 2001