Level 15

Retirement tax questions

For the same 401(k) account to be used for your self-employed retirement contributions it must be the account associated with the individual 401(k) plan established under your self-employment business.  Since a 401(k) account must be associated with an employer plan, you must have already done this.  Just be sure that you are not confusing a Roth IRA with a Roth 401(k) and that you actually have a Roth 401(k) at TD Ameritrade and not a Roth IRA.  Contributions to a Roth IRA are not employer contributions but still require having compensation to support the Roth IRA contribution and the limits are quite different from the contribution limits for a 401(k).  (If you haven't established an individual 401(k) plan with TD Ameritrade, I suspect that you actually have a Roth IRA, not a Roth 401(k)).

Roth 401(k) contributions are entered on the same page as the traditional 401(k) contributions.  After entering the self-employed retirement contribution section, answer Yes when TurboTax asks if you made any contributions to an individual or Roth 401(k).  Explicitly enter the amount of regular Roth 401(k) contributions and the amount of any catch-up Roth 401(k) contributions.  If you max out your Roth 401(k) contributions, for 2018 that's $18,500 regular and $6,000 catch-up, and you want to maximize your employer contribution (which is permitted only to be made to the traditional 401(k) account) you can then simply mark the Maximize box for the 401(k).  If you want to contribute less than the maximum employer contribution you would have to explicitly enter the amount of Employer Matching (Profit Sharing) Contributions.

Your total contributions (employee Roth or traditional and employer contributions) plus the deductible portion of self-employment taxes cannot exceed net profit from self employment.

Note that the Roth 401(k) contribution will not appear anywhere on your tax return, except, if you qualify, as part of the contribution total used to calculate a Retirement Savings Contributions Credit on Form 8880.