turbotax icon
Showing results for 
Search instead for 
Did you mean: 
Close icon
Do you have a TurboTax Online account?

We'll help you get started or pick up where you left off.

Turbo tax is saying not qualified for 401k deductions

income is under 40k per year. I think turbo tax is screwed up on this
This feature is pending. Thanks for your patience.
Didn't get the answer you wanted? Talk to a live expert to get the help you need.
3 Replies
Expert Alumni

Turbo tax is saying not qualified for 401k deductions

Contributions to your 401(k) plan are reported in Box 12 of your W-2 with a Code D.   As long as you enter your W-2 as you see it, TurboTax will calculate the correct deduction amounts for the Saver's credit.   Sometimes this is called the Credit for Qualified Retirement Savings Contribution or Retirement Credit. It’s a non-refundable tax credit which means it can’t reduce the amount of tax owed to less than zero.


Based on your income and filing status, you may claim a credit on your return for a percentage of the contributions you made to a qualified retirement plan.  You qualify for the credit if you’re:

  • 18 or older
  • Not a full-time student
  • Not claimed as a dependent on someone else’s return

In 2020 your adjusted gross income (AGI) also can’t be more than:

  • $65,000 if married filing jointly
  • $48,750 if head of household (with qualifying person)
  • $32,500 if single, married filing separately, or qualifying widow(er) with dependent child

The maximum credit is $1,000 ($2,000 for married taxpayers who are filing jointly), but is often less due to other deductions and credits and is limited by income. For more details on how to calculate your credit, see the IRS Saver's Credit page.


We’ll calculate this credit for you if you qualify and generate Form 8880.

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
New Member

Turbo tax is saying not qualified for 401k deductions

The help you offer says that Box 12 from the W-2 is related to a 401-K. I am getting an error message in my form saying that Box 12 is regarding to HSA.

Expert Alumni

Turbo tax is saying not qualified for 401k deductions

You must have entered a W for the coding in box 12.  Click here for all the W-2 codes for box 12.  


Check the box 12 codes closely. The code entered drives where the amounts flow through TurboTax.  If you think the coding on your W-2 are incorrect, contact your payroll provider for a corrected W-2.



message box icon

Get more help

Ask questions and learn more about your taxes and finances.

Post your Question
message box icon

Ready to start your taxes?

Hand off your taxes, get expert help, or do it yourself.

See Pricing
Manage cookies