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Level 2
posted Mar 24, 2024 8:45:11 PM

Turbotax 2023 -- does not appear to consider solo 401(k) Employer Matching (Profit Sharing) Contribution in tax calculation

I took the "standard" maximum $22.5K + $7.5k deduction on Schedule 1, Line 16 for my solo 401(k).  The program shows certain owe/refund amounts for Federal and State in the upper left.  If I increase this amount to the Contribution Worksheet max to include Employer Matching (Profit Sharing) Contribution (let's say it's another $15k), the program doesn't change the owe/refund amount.  

 

It would seem the owe/refund amounts must change if the employer contribution is before taxes.  Otherwise, I'd be paying taxes twice on the employer-contribution amount, now and then down the road when I take RMDs on the solo 401(k).  It is my understanding that all funds in 401(k) accounts are pre-tax.

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1 Replies
Level 2
Mar 24, 2024 9:14:00 PM

It appears (?) that the program wasn't recalculating.  I went to forms and hit 1040, Schedule 1 and supporting worksheets and the owe/refund number changed.  So I withdraw the question.