Here is my complete question.
Turbo Tax is incorrect relative to 403(b) contribution limits. They need to correct such before myself and others can submit our returns? When will Turbo Tax do so?
Turbo Tax will not let me submit my return because they claim I am only entitled a $26,000 deferment and not the actual $29,000 that my employer pulled from my monthly paychecks. I went thru this with Turbo Tax for tax years 2019 & 2018. They finally rewrote their software to allow the $29,000 deferment, but not until the very last moment before the deadline. Why can they make that a permanent change to their software instead of making people like me go thru this heartache every year?
Please refer to the two IRS.gov links below.
https://www.irs.gov/pub/irs-pdf/p4482.pdf
Retirement Topics 403b Contribution Limits | Internal Revenue Service (irs.gov)
If you follow along with all the various catch up provisions noted in the IRS example below, pulled from one of the links above, a 15 yr employee can defer an extra $3000 to bring the total up to $22,500 that she can defer for tax year 2020. In addition a person that is over 50 can defer another $6500 to bring the total up to $29,000 (22,500 + 6500).
Example from the 2nd IRS link: Assume Pat, age 50, has worked as a teacher in the XYZ School District for 15 years; is eligible for the 15 years of service catch-up; and has eligible compensation of $70,000 for 2020. The maximum employee and employer contributions to the XYZ 403(b) plan for 2020 for Pat would be $63,500 ($57,000 annual addition + $6,500 age 50 catch-up):
- Pat made elective salary deferrals to the 403(b) plan in 2020 totaling $22,500 ($19,500 plus $3,000 15 years of service catch-up)
- An employer contribution of $34,500, brings the total employee and employer contributions to $57,000, the annual additions limit in 2020.
- Pat may also defer an additional $6,500 age 50 catch-up contribution in 2020.
To me this should be a non issue ... Turbo Tax needs to amend their software. Thanks.
