msindc1
Level 4
‎03-06-2024 01:50 PM

Folks:

Client is a consultant, operating through an S Corp.  Client's SEP IRA contribution deduction is disallowed because she has no self-employment income.  But she does--all the money coming from the K-1.

Maybe Lacerte is treating the income as passive?  Is there something I have to do in the S Corp module (generating the K-1) to make the income count so that there can be an offset for teh retirement contributi9on?  Or in the Individual model?

Thanks.

Micah

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abctax55
Level 15
‎03-06-2024 01:57 PM

SEP IRA deduction would be taken on the S-Corp return, and based on the W-2 wages.

NOT on the F.1040

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msindc1
Level 4
‎03-06-2024 02:34 PM

Ah.  In that case, would you mind sharing how that is done?  Is it just a deduction in Pensions and Profit-Sharing Plans (and if there are multiple people doing voluntary contributions, do you not distinguish how much each person contributed?)

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PhoebeRoberts
Level 11
Level 11
‎03-06-2024 02:50 PM

A SEP is an employer-funded plan. All covered W-2 employees get the same percentage.

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abctax55
Level 15
‎03-06-2024 03:05 PM

A SEP plan doesn't have an 'employee' deferral component.  It is 100% paid/funded by the employer.

Listen to the 'taxgirlie' @PhoebeRoberts 

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