topic Re: Cannot enter SEP Contribution in Retirement tax questions

Cannot enter SEP Contribution

steve1stsec — Thu, 07 May 2020 16:39:21 GMT

When I enter "Yes" to Self-Employment Plans, I receive a message that Self Employment Plan are for Self-employment income or K1's. I did not enter Self-Employment Income, but I did enter a K-1. How do I add the SEP Contribution Deduction with only K-1 Income?

Re: Cannot enter SEP Contribution

BillM223 — Thu, 07 May 2020 17:52:50 GMT

TurboTax employee Isabella has previously addressed this issue.

"The income must be earned income to qualify for the child and dependent care credit. If this income is on a K-1:

If the K-1 is from a partnership (Form 1065), it will count as earned income if there is an entry in box 14 with code A net earnings from self-employment.

If this K-1 is from an S corporation (Form 1120S), then the corporation must have issued a W-2 as an employee for you to have earned income."

So, is the income listed one of these ways?

Re: Cannot enter SEP Contribution

steve1stsec — Fri, 08 May 2020 17:18:45 GMT

Thanks for your response. Yes, the K-1 is from an s-corp (1120-s). It's a single-member llc with an s-corp election. The single member also is on a w-2 payroll in which self employment taxes are paid by the employer and employee. I was not able to go through the easy-guide, but went directly to the form and entered contribution and it appears to work fine. Thanks Again.

Re: Cannot enter SEP Contribution

dmertz — Fri, 08 May 2020 17:27:10 GMT

Except for a self-employed health insurance deduction, you are not self-employed. You are an employee of the S corp and the deduction for the retirement contributions goes on the S corp's tax return, not on your personal tax return. The maximum SEP contribution is 25% of your S corp compensation reflected on your W-2 from the S corp.