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aandjcecutti
New Member

You can put in retirement $26,000 for over 50 years and $3,000 catch up if 15 years with company . Why did turbo tax not realize this and say this was an error ?

 
7 Replies
MarilynG1
Expert Alumni

You can put in retirement $26,000 for over 50 years and $3,000 catch up if 15 years with company . Why did turbo tax not realize this and say this was an error ?

You can put a Total Contribution of $26,000 in 401K if you are over 50, so this is not an error. 

 

$19,500 for a regular contribution, plus $6,500 'catch up' contribution.  

 

The 'catch up'  has to do with your age, not how many years you are with the company, so unclear what the $3,000 'catch up' you are referring to is. 

 

Click this link for detailed info on Retirement Savings. 

 

 

 

 

 

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VolvoGirl
Level 15

You can put in retirement $26,000 for over 50 years and $3,000 catch up if 15 years with company . Why did turbo tax not realize this and say this was an error ?

Do you have an amount on W2 box 12 for more?  Then check with your employer.  They may have let you contribute too much.  Or are you trying to enter this in the IRA section?  It is not an IRA.  You only enter it from your W2 nowhere else.  It has already been deducted from the Wages in box 1 and you can't deduct it again.  

dmertz
Level 15

You can put in retirement $26,000 for over 50 years and $3,000 catch up if 15 years with company . Why did turbo tax not realize this and say this was an error ?

This is apparently a 403(b) with a special $3,000 catch-up.  I don't see that TurboTax's Smart Check erroneously flags this as an error in the CD/download version of TurboTax, but if in the final check before e-filing TurboTax erroneously says that your total of $29,000 of elective deferrals to the 403(b) include an excess contribution because they exceed the $19,500 regular limit plus the age-50 $6,000 catch-up and prevents you from e-filing, you'll have to print and mail your tax return.

 

Note that if you contribute to any other 403(b), 401(k) or federal TSP plans, your total elective deferrals to all of these types of plans is not permitted to exceed $29,000 (including your $3,000 special catch-up contribution to the 403(b)).

dmertz
Level 15

You can put in retirement $26,000 for over 50 years and $3,000 catch up if 15 years with company . Why did turbo tax not realize this and say this was an error ?

Ah, I see that it's the online version of TurboTax that is erroneously indicating that you've made an excess 403(b) elective deferral.  You can ignore that message.

franreidy
Returning Member

You can put in retirement $26,000 for over 50 years and $3,000 catch up if 15 years with company . Why did turbo tax not realize this and say this was an error ?

There are two catch-up options and both can be used. The over 50 which most people know about, and 15 years with the same company catch up. So a profession like a teacher, can do $29,000 for 2020 - $19,500, the $6,500 catch up, and the $3,000 same company catch up. 

vmk1
Returning Member

You can put in retirement $26,000 for over 50 years and $3,000 catch up if 15 years with company . Why did turbo tax not realize this and say this was an error ?

Does it calculate the tax owed correctly since the $3000 would reduce taxable income?

dmertz
Level 15

You can put in retirement $26,000 for over 50 years and $3,000 catch up if 15 years with company . Why did turbo tax not realize this and say this was an error ?

The tax is calculated correctly because the employer who excludes the $3,000 catch-up from the amount in box 1, so the $3,000 never gets added to taxable income.

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