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I opened a solo401k, does TurboTax provide the forms for a tax credit?

 
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dmertz
Level 15

I opened a solo401k, does TurboTax provide the forms for a tax credit?

To qualify for the credit for pension (401(k)) startup costs, the company has must have at least one employee who is not a >5% owner.  Since a solo 401(k) likely implies that there are no such employees, it seems likely that this credit would not be permitted.  For a sole proprietorship, you can enter the pension startup cost into TurboTax as a business expense, answer TurboTax's related questions, complete the corresponding section under Business Deductions and Credits and, if you qualify, TurboTax will prepare Form 8881.

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3 Replies

I opened a solo401k, does TurboTax provide the forms for a tax credit?

TurboTax has Form 8881, if that's what you mean.

 

https://www.irs.gov/instructions/i8881

 

I'm not sure that's the proper form, though, so I'll page @dmertz.

I opened a solo401k, does TurboTax provide the forms for a tax credit?

Did you find where to enter the solo 401K ?  Where to enter Self Employed solo 401K plans

https://ttlc.intuit.com/questions/1901283-where-do-i-enter-my-401-k-or-thrift-savings-plan-tsp-contr...

 

You can contribute to a 401K up to the amount of your Net Profit reduced by 1/2 of the SE tax OR to the max contribution allowed for a 401k whichever is Less.

 

You might qualify for the Savers Credit 

https://turbotax.intuit.com/tax-tips/tax-deductions-and-credits/what-is-the-savers-credit/L3LyopRkK

 

I don’t know where it is.  It might be under

Federal Taxes Tab

Deductions & Credits

-Scroll down to:

--Other deductions & Credits

 

 

dmertz
Level 15

I opened a solo401k, does TurboTax provide the forms for a tax credit?

To qualify for the credit for pension (401(k)) startup costs, the company has must have at least one employee who is not a >5% owner.  Since a solo 401(k) likely implies that there are no such employees, it seems likely that this credit would not be permitted.  For a sole proprietorship, you can enter the pension startup cost into TurboTax as a business expense, answer TurboTax's related questions, complete the corresponding section under Business Deductions and Credits and, if you qualify, TurboTax will prepare Form 8881.

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