Hello TurboTax Community:
My business is structured as multi-member LLC - we report business income and deductions on Form 1065, which then generates K1 for me and my business partner.
Using TurboTax Business for our business tax, the maximum contribution to retirement account (SEP-IRA) is calculated based on 25% of business profit, and the contribution amount is reported on K1 under 13R.
When I entered all the numbers from my K1 (including contribution to retirement account) into TurboTax for my personal tax, I realized that the max. allowed contribution is actually capped. TurboTax is taking net business income, minus a portion of self-employment income, and multiply by 20% to get the upper threshold. As a result, the max. allowed contribution is lower than what's actually reported on my K1 under 13R. I would never have realized this difference until I start working on my personal tax.
The tricky thing is, our business tax was filed just a few days ago - the filing deadline was 3/15/2020. Will I need to go back and modify the business tax re: the retirement contribution? If I modify the business tax, then the generated K1s will be different, right? Once I enter the updated K1 numbers into TurboTax, will I get a different contribution threshold again for my personal tax?
I'm quite confused about what to do next... Please help!! Thank you!
