topic 401k Elective Deferrals in Deductions & credits

401k Elective Deferrals

mach_one — Fri, 07 Feb 2020 01:23:08 GMT

Under the business income and expenses tab for Individual and Roth 401k plans. Do I enter my employer elective deferrals in the tab input and my employer matching contributions in tab input?

Re: 401k Elective Deferrals

DianeC958 — Fri, 07 Feb 2020 13:48:56 GMT

You only enter your employer matching contributions. The amount the employees are contributing was withheld from their pay so that amount is not deductible for the business.

Re: 401k Elective Deferrals

mach_one — Fri, 07 Feb 2020 21:25:18 GMT

I better start over and explain. The first few months of the year I was SE then got a job with another employer. That employer I elected to defer into the 401k and they matched. So I only enter the matched contribution from my employer? My elective deferral and matching would be with the other employer. I was SE so only a single employee. I'm trying to determine how much I can contribute to my SEP.

Re: 401k Elective Deferrals

LindaB1993 — Wed, 12 Feb 2020 20:16:28 GMT

SEPs can get set up to contribute up to 25% of salary up to an annual maximum, and that amount is going up in 2019. Maximum contributions are $56,000 in 2019, up from $55,000 in 2018 and marking the third straight year of annual increases..

Do your 401k contributions reduce the amount you can contribute to a SEP IRA?

The answer is no, assuming that the 401k and SEP IRA are with two different companies not under common control. Why? While the employee contribution limits to a 401k are per person, the employer contribution limits (including a SEP IRA for the self-employed) are per plan.

Re: 401k Elective Deferrals

mach_one — Wed, 12 Feb 2020 20:56:21 GMT

So my contribution to the 401k and matching funds from the company are NOT to be entered in the [Under the business income and expenses tab] for Individual and Roth 401k plans. Do I enter my employer elective deferrals 401k in the tab input and my employer-matching 401k contributions in tab input?

Re: 401k Elective Deferrals

JohnB5677 — Wed, 12 Feb 2020 22:24:30 GMT

As I understand it you have two plans. You have a 401-K that you have with your employer, and you have a SEP from when you were self-employed. If I have that correctly, This is how to handle it.

The contributions to the 401-K are going to be reflected on your W-2 and should not be posted anywhere else. If you look at your W-2, BOX 1 will be less than BOX 3 by atleast the amount of your 401-K contribution. BOX 1 is your income and BOX 3 is what you earned.
For your SEP you can make a contribution of up to 25% of your Net profit from Self-Employment.