Why sign in to the Community?

  • Submit a question
  • Check your notifications
Sign in to the Community or Sign in to TurboTax and start working on your taxes
New Member
posted Jun 3, 2019 12:44:08 PM

I made $330 on a W-2 and $3410 on a 1099MISC. I contributed 3740 to a Roth IRA. Turbo Tax is telling me that I have over contributed by $241. How can that be?

0 1 210
1 Replies
Expert Alumni
Jun 3, 2019 12:44:10 PM

In order to come up with your Adjusted Gross Income (AGI), you need to subtract 1/2 of your Self-Employment tax from your Schedule C profit.  This is why TurboTax is telling you that you have over contributed by $241.

So your "eligible earned income" for purposes of a Roth IRA contribution will include your wages of $330 (Line 1 of your Form 1040) + your Schedule C profit (Schedule 1, Line 12) - 1/2 of your Self Employment Tax (Schedule 1, Line 27).

If you need further clarification, please comment below.