401K contributions (deferred salary) gets deducted from my paychecks. The last pay period was December 15- December 29 2023, but the paycheck date is January 7 2024. Does the amount deducted in this paycheck / payperiod go towards 2023 401K contribution, or 2024? Same question for HSA contribution (but I suspect a different answer).
You'll need to sign in or create an account to connect with an expert.
In this instance it depends on your employer. If the amounts are included on your 2023 W2 (because your employer uses the accrual system) then they are reported on your 2023 return even though you didn't actually receive the money or have the contributions made to your account(s) until January 7 of 2024.
Hm. My employer attributed 401K to 2023 but HSA to 2024, although they came from the same payperiod/paycheck. Looks like an error. But which way?
Is there a way to tell for sure which way is correct? Is there a law, regulation, IRS ruling, or detailed explanation I could read about this? The employer is the state of WA, so it is very likely it is on the accrual basis.
I mean the rules for the accrual basis is the only thing that you would be reading. The date that the transaction is put on the books. So in your case the employer didn't book the HSA until after January first and the 401k on the date that the payroll was issued. Which makes sense. The HSA contributions are probably sent on the first of the month and the 401k is probably distributed with the payroll.
Here are the rules for the accrual basis according to the IRS.
Still have questions?
Questions are answered within a few hours on average.
Post a Question*Must create login to post
Ask questions and learn more about your taxes and finances.
d-tedesco
New Member
ahossler
New Member
ccnan
New Member
donutcrumbs
New Member
jackf1958
New Member