1099 Realtor with Solo 401K - How to File Contributions & Profit Share

[bc999lonsdale]

I am a Realtor with EIN who is paid as an independent contractor via 1099-NEC.

I created a solo-401K, and contribute to it with both salary ($19, 500 for 2020) and profit share (still calculating this).

My question is that it seems there are multiple places to enter this info.  Which is correct?  

I see Schedule C, section II, line 19 as an expense (presumably for the profit share portion??)

I also see in Schedule 1, line 15 that the total for both is entered there as an adjustment to income.

It would make sense to be able to deduct it as an expense (as the employer of myself), and then defer it as income (as the employee of myself) to my solo 401K.  Is that correct?  Or is that duplicating the figures?

Who can make sense of this?  Any help is appreciated.

[dmertz]

The deduction goes on Schedule 1.  The entry on Schedule C is only for contributions to the accounts of your employees (of which you apparently have none).

[bc999lonsdale]

But I am my own employee.  So, wouldn't it make sense to take it as a deduction for the profit share portion on the schedule C since this is a portion of the profit from my business?

[dmertz]

That's simply not how it's done for the self-employed.  It has partly to do with the fact that the employer contributions reduce the amount from which the employer contribution is calculated.  It also has to do with the fact that and employee elective deferral reduces the individual's taxable income, not the employer's taxable income, and that the employee elective deferral can affect the amount of employer contribution that is permitted, so the employee and employer contributions must be determined concurrently.