A client, a former NYC teacher, received an overpayment of summer pay in 2011. She paid back the gross (not net) overpayment to NYC in 2013 per their demand. The W2 containing all the dollars paid to her was included in her 2011 tax return. NYC is saying they do not issue a corrected W2 for the year and she reports the payback on her 2013 return.
Has anyone had a similar matter and can anyone provide guidance. How does one report negative income - the original payments to her had social security/medicare withheld, federal tax, NYS and NYC (she was a NYC resident and is no longer one).
IRS practitioner priority service was of no use and NYC is, as always, NYC.
Thanks.
-------------------------------------------
Jay P. Haberman, CPA
998C Old Country Rd, PMB 422
Plainview, NY 11803
(516) 775-0175
jayh@cpa.com -------------------------------------------