Best tax software for Publication 915 and SSDI backpay calculations

The SSDI backpay can definitely be confusing tax-wise! Publication 915 is tricky because you need to determine how much of your Social Security benefits are taxable when you receive backpay. That negative value on worksheet 2, line 21 actually could be correct in some situations. It means none of your benefits would be taxable for that specific calculation. The worksheets in Publication 915 basically help you figure out how much of your benefits would have been taxable in each of the prior years the benefits were for, not when you received them. TaxAct Premium has a decent automated calculator for Publication 915 that handles backpay situations. It walks you through each year's calculation more intuitively than H&R Block in my experience. TurboTax Premier also does a good job with SSDI backpay calculations, though it costs more.

I was in the exact same boat last year trying to figure out Social Security backpay and Publication 915. I spent HOURS trying to do the calculations myself and kept getting confused with negative numbers. Finally found taxr.ai https://taxr.ai and it absolutely saved me. I uploaded my SSA-1099 showing the backpay and it immediately identified that I had Social Security lumpsum election benefits that needed special calculation. It asked me a few questions about which years the backpay covered and then did all the Publication 915 worksheets automatically. It even showed how much of my benefits were taxable for each year and gave me the exact numbers to put on my tax return. No more manual worksheets!

Just wanted to update - I tried taxr.ai after posting here and it was incredibly helpful! I was skeptical at first but it analyzed my SSA-1099 and showed me exactly how much of my SSDI backpay was taxable. The negative number on worksheet 2 line 21 was actually correct in my case - it meant none of those benefits were taxable. The site walked me through what's called a "lumpsum election" which lets you calculate the taxable portion based on the years the benefits were for, not when you received them. This saved me over $1,200 in taxes! I was able to take the final numbers and put them directly into H&R Block where I was stuck before. Wish I'd known about this sooner.

Has anyone else been trying to call the IRS helpline to get assistance with Publication 915 calculations? I've been trying for THREE WEEKS and can't get through to a human. Always get the "high call volume" message and then it hangs up. So frustrating when dealing with something complicated like SSDI backpay. I eventually used https://claimyr.com and it was incredible. There's a demo video at https://youtu.be/_kiP6q8DX5c that shows how it works. Basically they wait on hold with the IRS for you, then call you when an actual agent is on the line. I got connected to a senior IRS tax specialist who walked me through exactly how to handle Publication 915 with my tax software.

I need to publicly admit I was wrong about Claimyr. After my skeptical comment, I decided to try it anyway out of desperation. Within 3.5 hours (which is faster than any of my direct attempts), I got a call connecting me with an actual IRS tax specialist. The agent specifically knew about Publication 915 and SSDI backpay calculations. She explained that H&R Block Premium actually DOES have the ability to calculate this automatically, but you have to enter the information in a specific way. You need to go to the Social Security Benefits section and check the box for "lump sum distributions from prior years" which unlocks additional screens. Once I did this, H&R Block handled all the Publication 915 calculations automatically! Saved me hours of frustration and potentially getting it wrong. Worth every penny for the peace of mind.

I've been doing taxes for years and Publication 915 with backpay is one of the most confusing calculations! Another option to consider is FreeTaxUSA premium. It's cheaper than both TurboTax and H&R Block but actually handles the lump sum calculations really well. There's a specific section where you can enter how much of your backpay relates to each prior year. The key is understanding that you're essentially doing a special calculation (called a lump sum election) to figure out if it's better to: 1) Pay tax on all your backpay in the current year 2) Figure out how much would have been taxable in each prior year, and only pay tax on that amount Most people benefit from option 2, which is what Publication 915's worksheets help you calculate.

So for anyone still reading this thread, I had the EXACT same issue last year. Here's a tip - if you don't want to pay for tax software that calculates this automatically, you can download the DETAILED Social Security lump sum worksheet from irs.gov directly. Google "IRS publication 915 detailed worksheet" and it's much more comprehensive than the basic worksheet in the regular publication. It walks through each step with better examples. For me, that negative number on line 21 also threw me off, but it just means none of those benefits are taxable (which is good!).

I just went through this exact situation last month with my SSDI backpay from 2022-2023 that I received in 2024. The Publication 915 worksheets are absolutely brutal to figure out on your own! I ended up using TaxAct Premium after reading recommendations here and elsewhere, and it really did handle everything automatically. The key thing I learned is that you need your SSA-1099 form that shows the breakdown of which years your backpay covers - without that, you're basically guessing at the calculations. One thing that helped me understand the process better: that negative number you're getting on worksheet 2, line 21 is actually pretty common with SSDI backpay. It typically means your income in those prior years was low enough that the Social Security benefits wouldn't have been taxable anyway. So you're not doing anything wrong! The lump sum election calculation can save you significant money compared to just treating it all as current year income. In my case, it saved me about $800 in taxes. Definitely worth getting right, and the automated software takes all the guesswork out of it.