topic Form 1065 (K-1) Partnership Employer contribution to 401K in Business & farm

Form 1065 (K-1) Partnership Employer contribution to 401K

TLee4 — Tue, 24 Feb 2026 07:29:13 GMT

I used Turbo Tax business to complete partnership taxes and then transferred the k-1 manually into Turbo Tax premier for pass-through income. The box 13R employer contribution to retirement (401K) does not appear to reduce taxable income. I may be mis-reading the tax law. Is it not the case that employER contributions are pre-tax and so would reduce the partnership income?

Re: Form 1065 (K-1) Partnership Employer contribution to 401K

Mike9241 — Sun, 03 Sep 2023 04:49:50 GMT

no. it is not a partnership expense for tax purposes. however, it is usually treated as a book expense.

example:

net income before retirement plan contributions 300 schedule K line 1

self-employment income schedule K line 14a 300

retirement plan contribution line 13d code R 20

analysis of net income 280

M-1 line 1 net income per books 280 and line 9 and M-2 line 3 (assuming retirement plan contributions are charged against book income and not charged to the partnership's capital accounts directly

Re: Form 1065 (K-1) Partnership Employer contribution to 401K

Rick19744 — Thu, 07 Sep 2023 13:56:09 GMT

Not sure if this is clear, but a partnership's contribution to a 401k is considered a guaranteed payment to the respective partner; both the partner's and partnership's contribution.

These amounts are then subtracted on the partner's individual tax return as a 401k contribution.