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Understanding Maximum 401k Contributions
This is the Second Time I have posted this question. Please answer the questions at the end of this post in which I ask where in Turbo Tax should I enter specific information.
I am using Turbo Tax for Home and Small Business and am working on my SELF-EMPLOYED RETIREMENT PLAN.
On the screen in which I enter my 2018 CONTRIBUTIONS, I have checked the box to have Turbo Tax MAXIMIZE MY CONTRIBUTIONS TO INDIVIDUAL IRA.
Turbo Tax calculated this number to be $38,936.
In a previous TURBOTAX ANSWER EXCHAGE it was explained to me that $24,500 of that $38,936 is an ELECTIVE DEFERRAL and that the remaining $14,436 is the EMPLOYER CONTRIBUTION.
Am I correct in assuming that the $14,436 is entered on the same screen as above, in the box associated with the heading EMPLOYER MATCHING (Profit Sharing) CONTRIBUTION?
Also, at the and of the interview for this section, Turbo Tax asks me the following:
Enter the amount of $38.396 Keogh, SEP, Simple or 401 (k) plan contribution deduction attributable to [MY COMAPNY NAME}.
Should the amount for the preceding be the $14,436 Employer Contribution?
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Understanding Maximum 401k Contributions
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Understanding Maximum 401k Contributions
- Yes, $14,436 is the Employer Matching (Profit Sharing) Contribution, but this should NOT be explicitly entered in the corresponding box if you mark the Maximize box. When you mark the Maximize box, TurboTax automatically calculates and uses this maximum amount.
- No. Given that you have a single self-employment business, the entire amount of $38,936 is attributable to that business. Enter $38,936 (not the $38,396 that you mistyped).
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