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Level 1
posted Jun 3, 2019 4:55:20 PM

What happens if I uncheck a box for retirement plan that a W-2 has incorrectly checked?

My husband worked for company A until Dec. 2017 and had a retirement plan.  He went to work for company B in Jan. 2018 and has no retirement plan. Company A paid his last paycheck for work from 12-15 to 12-30-17 in Jan. 2018 and contributed $284 to his 401K.  The box for Retirement Plan is checked on his W-2 which keeps him from contributing the max to his IRA because it looks like he was in a retirement plan for part of 2018.  His income was earned in 2017 so he was never in a retirement plan in 2018.  Because of this he can only deduct $2250 of a $6500 contribution to his IRA.  If that wasn't checked, then he could deduct $6500.  Is there any way around this?

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1 Best answer
Expert Alumni
Jun 3, 2019 4:55:22 PM

No, unfortunately, there is no way around this unless the Employer is willing to issue a corrected W2 without the pension plan box checked.

The IRS considers you to be "covered" for the whole year, even if it was only one day.  

If the pension plan box is checked on the Form W2, the IRS has this information and will consider your husband "covered" by an employer plan for 2018.

3 Replies
Expert Alumni
Jun 3, 2019 4:55:22 PM

No, unfortunately, there is no way around this unless the Employer is willing to issue a corrected W2 without the pension plan box checked.

The IRS considers you to be "covered" for the whole year, even if it was only one day.  

If the pension plan box is checked on the Form W2, the IRS has this information and will consider your husband "covered" by an employer plan for 2018.

Level 1
Jun 3, 2019 4:55:23 PM

A CPA told me her program has forms she can fill out/attach that explains if something was done differently in a situation like this.  Does Turbotax have anything like this?  The company won't issue a corrected one.

Level 15
Jun 3, 2019 4:55:25 PM

If he or the employer contributed to the 401(k) anytime during the plan year, that box must be checked.   A $284 2018 contribution is a 2018 contribution - no way around that.