Roth IRA contribution Schedule C

[suenphillips]

My husband and I changed our business from an S-Corp with W-2's this past year to two Schedule C business. Mine made money and his did not.  We each contributed $7000 to our Roth IRA at the beginning of the year. We no longer have any w-2 income, only business income. Turbo Tax is not allowing me to make Roth IRA contributions under personal income and says we have up to $27,133 that we can contribute under a business Roth 401(k), sep, simple, etc. which we don't have set up other than the Roth IRA I've been using the past several years. What should I do?

[RobertG]

The first action you'll need to take is to choose a financial institution to serve as trustee of the SEP-IRAs that will hold each employee's retirement plan assets. These accounts will receive the contributions you make to the plan. Almost any financial institution can do it.

See the IRS website: Establishing a SEP

Before you enter your SEP IRA contributions, first make sure you've entered self-employed income. This allows us to calculate the maximum amount you're allowed to contribute to your SEP IRA.

Once your self-employment income is entered:

1. In your return, type SEP IRA contributions (use the whole phrase) in the Search box.
2. Select the Jump to link at the top of the search results.
3. This will take you to the Self-Employed Retirement Plans screen.
   • If you get a message that Self-Employed Retirement Plans are only for self-employed individuals, this means that you have not entered any self-employed income.
4. TurboTax will ask you about whether you contributed to different types of retirement plans. Select Yes to Keogh, SEP and SIMPLE Contributions.
5. On the Your Contributions screen, you’ll be able to input your SEP IRA contributions.