How do I get to Schedule C Line 19 to enter a business deduction for contributions made to a SIMPLE retirement plan? (I am a self-employed sole proprietor)

[MinhT · Accepted solution]

You do not enter your contributions to your SIMPLE plan directly on Schedule C.

You enter them in TurboTax and the program will transfer them to line 19 on Schedule C.

To enter your self-employed retirement in TurboTax Self-Employed:

• Open your return and click on Search at the top right of your screen
• In the Search box, type self-employed retirement then click on the magnifying glass icon on the right
• On the results page. click on Jump to self-employed retirement
• TurboTax will take to to an interview where you enter your SIMPLE plan contributions.

[hawg0313]

Actually, yes, the EMPLOYER contributions to the SIMPLE are a business deduction and are supposed to be included in the Schedule C. The directions you gave are for both employee and employer contributions which will show up on the 1040. Ironically, TurboTax actually has a note which says, don’t forget to also record this as a business deduction!

[MinhT]

If you have no employee, this is where you enter your total of employer and employee contributions. If you have employees, the employees' contribution are deducted from their wages and the employer's contributions are deducted as a business expense under Less Common Expenses > Employee Pension plan.

[dmertz]

As TurboTaxMinhT indicated, only SIMPLE contributions for your employees (other than yourself) go on Schedule C.  TurboTaxMinhT's answer correctly tells you how to get to the section where you enter your own self-employed retirement contributions.

[hawg0313]

From the IRS Website: If you are a sole proprietor or partner, however, you would deduct your own salary reduction contributions and your own matching or nonelective contributions on Form 1040, line 28.
And: Where do I report the contributions I make for myself to my SIMPLE IRA?
Report both your salary reduction contributions and employer contributions (non-elective or matching) for yourself on line 28 of Form 1040.
This is different from reporting employer contributions (non-elective or matching) for your common-law employees, which you would do as a business expense on your Schedule C.

[hawg0313]

As the sole proprietor, I am BOTH employee, and employer

[dmertz]

Yes, that all agrees with what TurboTaxMinhT and I have said.

[hawg0313]

<a rel="nofollow" target="_blank" href="https://www.irs.gov/retirement-plans/simple-ira-tips-for-the-sole-proprietor:">https://www.irs.gov/r...>

If you are a Schedule C filer (a sole proprietor) and have a SIMPLE IRA plan, you are treated as both an employer and an employee when calculating and reporting your own plan contributions and limits. Here are some tips.

Where do I report the contributions I make for myself to my SIMPLE IRA?
Report both your salary reduction contributions and employer contributions (non-elective or matching) for yourself on line 28 of Form 1040.

This is different from reporting employer contributions (non-elective or matching) for your common-law employees, which you would do as a business expense on your Schedule C.

[MinhT]

This is exactly what @dmertz and I have said. When you enter both your employee and employer contributions as self-employed retirement in TurboTax, TurboTax will transfer the amount to line 28 of form 1040 (and not to Schedule C).

[hawg0313]

The IRS website literally says you get both.

[hawg0313]

Here is yet another IRS website that says I put it on both the 1040, line 28 AND Schedule C, line 19:
<a rel="nofollow" target="_blank" href="https://www.irstaxforumsonline.com/sites/default/files/players/sep16/downloads/sep16transcript.pdf">...>
"Line 28 of the Form 1040 is the place you report the
deductions you made for yourself to the SEP or the SIMPLE IRA
if you are self-employed. ........ So then Line 19 of the Form 1040 (Schedule C) is the line item for
the deduction for contributions made to your employees and that
line is called Pension and Profit-Sharing Plans."

[hawg0313]

"....the employer's contributions are deducted as a business expense under Less Common Expenses > Employee Pension plan.
~TurboTaxMinhT 4 hours ago"

Please Help! TurboTaxMinhT!  There is no option for me called "Employee Pension Plan". That is what I'm spending all this time looking for!

[hawg0313]

Under Less Common Expenses, mine goes (in alphabetical order) from "Credit Card, Loan..." to "Equipment Rental"

[dmertz]

For your *own* contributions, TurboTaxMinhT's answer said to type "self-employed retirement" in the search box (be sure to include the hyphen and omit the quote marks), click on Jump to self-employed retirement, then complete the self-employed retirement interview.  This will take you to Income & Expenses -> Other Business Situations -> Self-Employed Retirement Plans.  Answer Yes to Self Employed Retirement Plan.  Answer No to Individual or Roth 401(k) plan.  Answer Yes to Keogh, SEP and SIMPLE Contributions.