TurboTax's self-employed 401(k) Maximize function simply wasn't programmed to handle this situation where the self-employed person also makes elective deferrals or Roth contributions to another employer's plan . It's a known (but not advertised) limitation of TurboTax that Intuit has chosen to leave as an unsupported calculation.
Regarding box 3 of you W-2, your the Social Security portion of your self-employment taxes are calculated on only the amount necessary to reach the $118,500 Social Security wage base when combined with the income subject to Social Security tax shown in box 3 of your W-2s. Since you mentioned a maximum individual 401(k) employer contribution of $9,866, it was easy to determine that none of your net profit from self-employment was subject to Social Security tax. Your net earnings on which your maximum (20%) employer contribution is calculated is your net profit minus the deductible portion of self-employment taxes. Since, as a result of your W-2 income, you are subject to less self-employment taxes than someone whose total compensation does not reach the Social Security wage base, your employer contribution is higher than it would be for someone who had to pay more in self-employment taxes on the same amount of net profit.
