It is possible that you have something like a qualified business income (QBI) deduction and the contribution to the SEP retirement plan is reducing that deduction which may increase your taxable income even after you deduct the SEP contribution. You will see the QBI deduction on line 13 of your form 1040.
Also, you may be over contributing to your retirment plans which would create a penalty. You would see that on line 8 of form 1040, schedule 2.
I suggest you look at your form 1040 both before the SEP contribution and after to see what is changing.
You can view your form 1040 and schedules 1 to 3 while working in the online version of TurboTax by following these steps:
- Click on Tax Tools in the left menu bar
- Click on Tools
- Look under Other Helpful links….
- Choose View Tax Summary
- Look in the left menu bar and choose Preview my 1040
- Scroll down the page to see form 1040 and schedules 1 to 3
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