ue1
Level 3

S-Corp contributed to owners 401 - should I create 1099?

Two questions:

 

  1. If an S-Corp contributes to its owner's 401k, does the S-Corp need to issue a 1099? If yes, which 1099 is it? MISC?
  2. The contribution to my 401K is NOT showing on my W-2. Do I need to update and re-issue a W-2?
DavidS127
Expert Alumni

Business & farm

If you are also an employee of the S Corp, the contributions to the 401(k) can only be made from your wages, not your distributions.  Distributions are not considered earned income for purposes of 401(k) contributions.

 

If you made made contributions to a 401(k) plan from your salary, your contributions should show up as a box 12 amount with a code of D, and your box 1 should be "net" of these "elective deferrals".  If your W-2 is not correct, you should arrange for a corrected W-2.

 

If you’ve made contributions to a 401(k) plan based on a shareholder’s S corporation’s distributions, click here to find out how you can correct this mistake.

 

See the IRS website at this link for more information on retirement plan contributions for an S Corp.

 

The IRS website at this link discusses how to report medical insurance premiums paid for a "more tha....

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ue1
Level 3

Business & farm

Intuit online payroll service does not handle amended W-2 (filed electronically, completed). 

Can I use TurboTax Business to amend an employee W-2, requiring also W-3c and 941-X?

DawnC
Employee Tax Expert

Business & farm

Unfortunately, no.  TurboTax Business uses Quick Employer Forms (QEF) to prepare W-2s and 1099-s.  QEF does not support corrected forms at this time. Once the original e-filing is accepted:

  • To file a corrected W-2, go to the SSA website and file the corrected form, W-2C electronically. You can also use the IRS website for forms and instructions.
  • To file a corrected 1099, use the IRS website forms and instructions for corrections.

 

Helpful Hints To Forms W-2c/W-3c Filing

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ue1
Level 3

Business & farm

  1. When an S-Corp files an amended W-2 through the SSA website, do I also need to send it to the IRS?
  2. The W-2 amendment is inclusion of 401K distribution the S-Corp made directly into the plan without accounting for it in the employee's (owner) W-2. Does that also trigger the need to amend form 940/941?
DavidD66
Expert Alumni

Business & farm

  1. You do not need to send anything to the IRS after amending a W-2 on the SSA website.
  2. If the changes you made to the W-2 changed the amounts that were reported on Form 940/941, then yes, you will need to amend it.
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