I have a question about my solo 401K plan. I own an s-corp and am the only owner/employee. In 2016, I had a total salary of $23,500.
Here are the contributions:
- $18,000 was an employee contribution to the solo 401k plan.
- $5,500 was an employer contribution to the solo 401k plan.
Here’s how they were deducted:
The $18,000 was deducted on Box 12 of my W-2
The $5,500 was deducted on 1120s Line 17.
Here’s the problem:
The $5,500 is showing up on 1040 Line 7. If this amount was already contributed to my plan, why would I pay income tax
on it? The tax software
is pulling this from my W2.
Here’s what the boxes in my W2 looks like:
Again, why would I pay tax on the $5,500 if its going to my solo 401k plan. This should not be showing up on my 1040, correct? Was my W-2 filled out incorrectly? I’m not sure what’s causing this. Please advise?