Self-Employed Retirement Plans

[Urescapade]

Under Business Deductions and Credits, I enter my 401k contributions. I have done this for years, in 2020 I am entering my 401k Contributions however it is not showing up in my summary indicating that TurboTax processed it. It it's not even reflected in my refund amount. I checked with my previous years and when I delete the 401k number it changes my return. My main concern is that it does not appear that this 2020 software is giving me credit for my 401k contributions. The State asked me about the Retirement plan info on the K-1 in Box 20, and it did reduced the amount owed to the state.

I think there is a software issue here entering the 401k info. I am going to delete the software and install it again to see if that works.

[dmertz]

Income on a Schedule K-1 (Form 1065) from a partnership is only income from self-employment to the extent that it's reported with code A in box 14.  Check the Keogh, SEP and SIMPLE Contribution Worksheet to see the calculation of the amount of the self-employed retirement deduction.  See that this amount propagates to Schedule 1 line 15.

Also, if income tax is already zero without the 401(k) contribution, the deduction for a self-employed retirement contribution will not reduce your tax liability.  The deduction for a self-employed retirement contribution will not reduce other taxes such as self-employment tax.

[Urescapade]

It is shows up on line 6 of worksheet of Keogh/SEP. So even though it's not being shown in the summary it's in there.  Thank you for your input. 

[dmertz]

Check Part III of the Keogh/SEP Wks to see the calculation of the deductible amount.

[Urescapade]

I have lots of zeros.

Part III

Rate: 

a. 0.25

b. 1.125

c. 0.2

Steps:

2a. 0

b. 0

c. 0

Part V

1. 0

2.0

[dmertz]

The Keogh/SEP Wks shows no net profit from self-employment from which to make a 401(k) contribution, implying that you do not have any nonzero amount with code A in box 14 of the Schedule K-1.

[Urescapade]

That is absolutely what happened. 14 a. had a zero. Oh boy, I will need to fix this. I have been using TT for years and I have never had this problem. Thank you for your input. 

[dmertz]

I'm not sure if you are referring to TurboTax for preparing your individual tax return or TurboTax Business for preparing the partnership tax return. TurboTax for your individual tax return has properly behaved this way at least as far back as 2006 so you might want to check your past tax returns for the same problem.

[Urescapade]

I am preparing for individual tax. I use an accountant for my business. I have always done my own personal taxes, for some reason when I entered the K-1 info I must have missed it or it didn't register. I looked at my past taxes and that's how I knew something was wrong and I posted the question. I was going to send to my accountant to review, but your input helped resolve the issue. thanks!