The following credits are refundable and are treated as payments of tax.
- Credit for excess social security tax or railroad retirement tax withheld.
- Credit from a regulated investment company.
Credit for Excess Social Security Tax or Railroad Retirement Tax Withheld
Most employers must withhold social security tax from your wages. Certain government employers (some federal, state, and local governments) do not have to withhold social security tax.
If you work for a railroad employer, that employer must withhold tier 1 railroad retirement (RRTA) tax and tier 2 RRTA tax.
If you worked for two or more employers in 2000, you may have had too much social security tax or RRTA withheld from your pay. You can claim the excess as a credit against your income tax. The following table shows the maximum amount of wages subject to tax and the maximum amount of tax that should have been withheld in 2000.
| Type of Tax |
Maximum wages subject to tax |
Maximum tax that should have been withheld |
| Social Security or RRTA tier 1 |
$76,200 |
$4,724.40 |
| RRTA tier 2 |
$56,700 |
$2,778.30 |
|
|
All wages are subject to Medicare tax withholding.
|
One employer.
If any one employer withheld social security or RRTA tax that exceeded the amounts in the preceding table, you cannot claim the extra amount withheld by that employer as a credit against your income tax. Your employer must adjust this for you.
Joint return.
If you are filing a joint return, you cannot add the social security or RRTA tax withheld from your spouse’s wages to the amount withheld from your wages. Figure the credit separately for both you and your spouse to determine if either of you has excess withholding.
How to claim the credit.
If you file Form 1040, enter the credit on line 61. If you file Form 1040A, include the credit in the total on line 40. Print "Excess SST" and show the amount of the credit in the space to the left of the line.
How to figure the credit if you did not work for a railroad.
If you did not work for a railroad during 2000, figure the credit as follows:
| 1. |
Add all social security tax withheld (but not more than $4,724.40 for each employer). Enter the total here |
|
| 2. |
Enter any uncollected social security tax on tips or group-term life insurance included in the total on Form 1040, line 57 |
|
| 3. |
Add lines 1 and 2. If $4,724.40 or less, stop here. You cannot claim the credit |
|
| 4. |
Social security tax limit |
4,724.40 |
| 5. |
Credit. Subtract line 4 from line 3. Enter the result here and on Form 1040, line 61 (or Form 1040A, line 40) |
|
Example.
You are married and file a joint return with your spouse who had no gross income in 2000. During 2000 you worked for the Brown Shoe Company and earned $45,000 in wages. Social security tax of $2,790 was withheld. You also worked for another employer in 2000 and earned $35,000 in wages. $2,170 of social security tax was withheld from these wages. Because you worked for more than one employer and your total wages were more than $76,200 you can claim a credit of $235.60 for the excess social security tax withheld.
| 1. |
Add all social security tax withheld (but not more than $4,724.40 for each employer). Enter the total here |
$4,960.00 |
| 2. |
Enter any uncollected social security tax on tips or group-term life insurance included in the total on Form 1040, line 57 |
-0- |
| 3. |
Add lines 1 and 2. If $4,724.40 or less, stop here. You cannot claim the credit |
4,960.00 |
| 4. |
Social security tax limit |
4,724.40 |
| 5. |
Credit. Subtract line 4 from line 3. Enter the result here and on Form 1040, line 61 (or Form 1040A, line 40) |
$235.60 |
How to figure the credit if you worked for a railroad.
If you were a railroad employee during 2000, figure the credit as follows:
| 1. |
Add all social security and tier 1 RRTA tax withheld (but not more than $4,724.40 for each employer). Enter the total here |
|
| 2. |
Enter any uncollected social security and tier 1 RRTA tax on tips or group-term life insurance included in the total on Form 1040, line 57 |
|
| 3. |
Add lines 1 and 2. If $4,724.40 or less, enter -0- on line 5 and go to line 6 |
|
| 4. |
Social security and tier 1 RRTA tax limit |
4,724.40 |
| 5. |
Subtract line 4 from line 3 |
|
| 6. |
Add all tier 2 RRTA tax withheld (but not more than $2,778.30 for each employer). Enter the total here |
|
| 7. |
Enter any uncollected tier 2 railroad retirement tax on tips or group-term life insurance included in the total on Form 1040, line 57 |
|
| 8. |
Add lines 6 and 7. If $2,778.30 or less, enter -0- on line 10 and go to line 11 |
|
| 9. |
RRTA tier 2 limit |
2,778.30 |
| 10. |
Subtract line 9 from line 8 |
|
| 11. |
Credit. Add lines 5 and 10. Enter the result here and on Form 1040, line 61 (or Form 1040A, line 40) |
|
Credit from a Regulated Investment Company
You must include in your income any amounts that an investment company (for example, a mutual fund) allocated to you as capital gain distributions, even if you did not actually receive them. If the investment company paid a tax on the capital gain, you are allowed a credit for the tax since it is considered paid by you. The company will send you Form 2439, Notice to Shareholder of Undistributed Long-Term Capital Gains, showing the undistributed capital gains amount and the tax paid, if any. Claim the credit by entering the amount on line 64, Form 1040, and checking box a. Also attach Copy B of Form 2439 to your return. See Capital Gain Distributions in chapter 9 for more information on undistributed capital gains.
Tax Table-1 |
Tax Table-2 |
Tax Table-3 |
Tax Table-4
Tax Table-5 |
Tax Table-6 |
Tax Table-7 |
Tax Table-8
Tax Table-9 |
Tax Table-10 |
Tax Table-11 |
Tax Table-12 |
Tax Rate Schedule
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