Hello,
I experienced this exact same situation with regards to the tax liability either not dropping or going up.
I did have Turbo Tax check the program and they insist that it is correct.
In analyzing it myself and walking back through the steps: I believe this happens because a contribution to the ER portion of your solo 401k actual decreases your QBI deduction. The Qualified Business Income Deduction.
The tax code limits that to specified income and at certain levels.
The reason why I believed that there was an error in TT is because a contribution as an ER should still reduce your self employment tax. So even though TT insists it's correct; it still doesn't make complete sense that there is no accompanying reduction in the tax liability. The "counter" at the top of the program does not move.
