I have a question about how to complete Schedule 1. I am retired and have a small amount of self-employment income. I would like to make the maximum contribution to a 401k plan. My question is whether my adjustments to income (line 22 on Schedule 1) can exceed my business income (line 9 on Schedule 1).
For example, I have income of about $12k (line 9). My self-employed insurance deduction is about $5k (line 16). Turbotax caculates my maximum 401k as about $11k (line 16). This means that my adjustments to income are about $16k (line 22). Does IRS allow line 22 to exceed line 9 on Schedule 1? Do I need to reduce my 401k to about $7k, so my adjustments just equal my business income.
Thanks.
