I have 1099 and SS income. I am making roth contributions for my wife and myself. Why doesn't this decrease my tax due? It raises tax due.

crazycowboy59 — Mon, 30 Mar 2020 16:11:12 GMT

Re: I have 1099 and SS income. I am making roth contributions for my wife and myself. Why doesn't this decrease my tax due? It raises tax due.

VolvoGirl — Mon, 30 Mar 2020 16:17:01 GMT

ROTH contributions do not give you a deduction now. You pay tax on you total income now but when you take a ROTH Distribution it will come out tax free and the earnings will be tax free too.

You need to have enough earned income to make a contribution. SS does not count as earned income. What kind of 1099 income? 1099Misc for self employment?

If you have self-employment income you can only contribute up to your net profit reduced by the deduction allowed for the ER portion of your self-employment taxes. See IRS publication 590A (page 39 for ROTH) https://www.irs.gov/pub/irs-pdf/p590a.pdf

So check 1040 Schedule 1 line 14. You have to deduct that amount from your Schedule C Net Profit. That will give you the allowed contribution for the 1099Misc income.

And make sure the Schedule C and ROTH Contribution are entered for the same person.

Re: I have 1099 and SS income. I am making roth contributions for my wife and myself. Why doesn't this decrease my tax due? It raises tax due.

fanfare — Mon, 30 Mar 2020 19:59:33 GMT

If your tax goes up that means TurboTax is imposing a penalty tax for a disallowed contribution.

topic I have 1099 and SS income. I am making roth contributions for my wife and myself. Why doesn't this decrease my tax due? It raises tax due. in Retirement tax questions

I have 1099 and SS income. I am making roth contributions for my wife and myself. Why doesn't this decrease my tax due? It raises tax due.

Re: I have 1099 and SS income. I am making roth contributions for my wife and myself. Why doesn't this decrease my tax due? It raises tax due.

Re: I have 1099 and SS income. I am making roth contributions for my wife and myself. Why doesn't this decrease my tax due? It raises tax due.