401k

I have a cash basis partnership who paid a 2023 401k contribution in 2024. I take the deduction in 2023.

On the 1065 do I show this as an accrued expense (ie show liability on balance sheet) or show it as an M-1 line 7 other deduction

posted

Show it as a liability. Being allowed to make a retirement plan contribution in the following tax year (prior to the due date of the return) is an exception to the cash basis rules. It is normal and acceptable to show the contribution as a liability on the balance sheet of your tax return.

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