When adding 401k contributions for you tax return is that a deduction? My W-2 already shows that amount as non taxable. So on the return where you are asked for that information is it deducted again? I am stuck on this because I have a non employer 401k that I put money into from savings. That I can get a deduction for?
Hope somebody can clarify this. Thanks
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No, you only want to enter this once for your contributions from your W2. There is no additional deduction because it was funded with pre-tax money. You have already received the tax benefit.
Are you contributing to a 401(k) or an IRA from your savings?
Yes I have a 401k not thru my employer that I put money from savings into. I have a Form 5498 for that account.
Why is there a way to add what your 401k from employment contributions are? This is what I am confused about. Will the IRS know what the W-2 shows is a 401k account? Box 1 on the W-2 reflects contributions to my 401k at work. I am really not sure if adding the amounts counts as a deduction thou?
"Yes I have a 401k not thru my employer that I put money from savings into."
Is this a "personal" or "solo 401(k)"? I.e., are you self-employed? You cannot contribute to a 401(k) plan unless you are employed or are self-employed.
As noted below, if you are an employee, the 401(k) contribution is noted in box 12 with a code of D. If you are self-employed, it is listed on line 15 on Schedule 1 (1040). You enter this in the Business interview in Self-employed or Home & Business.
"Will the IRS know what the W-2 shows is a 401k account"
On a W-2 in box 12 a code D with a dollar amount indicates the amount that was contributed to your 401(k) plan. As you can see, this amount is subtracted from Wages in box 1, but not from Wages in boxes 3 and 5.
"I am really not sure if adding the amounts counts as a deduction thou?"
Contributions to a 401(k) plan are "deductible" in the sense that they are removed from income, that it, you are never taxed on these dollars in the first place.
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