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January 19, 2025
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SEP IRA Contributions are not deducted from Tax bill in TurboTax?

  • January 19, 2025
  • 1 reply
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    Best answer by dmertz

    Are you self-employed?  If so, your maximum SEP contribution is determined from your net profit from self-employment.  No net profit, no permissible SEP contribution.

     

    If the SEP contribution was made by an employer from which you receive a W-2, the employer, not you, gets the deduction.

     

    1 reply

    dmertzAnswer
    Employee
    January 19, 2025

    Are you self-employed?  If so, your maximum SEP contribution is determined from your net profit from self-employment.  No net profit, no permissible SEP contribution.

     

    If the SEP contribution was made by an employer from which you receive a W-2, the employer, not you, gets the deduction.

     

    January 20, 2025

    Yes net profit. Yes self employed. The contribution not being subtracted from tax bill. 

    Employee
    January 20, 2025

    A SEP contribution is an above-the-line deduction on Schedule 1 that reduces AGI.  It does not subtract  directly from your tax liability.

     

    Examine TurboTax's Keogh, SEP and SIMPLE Contribution Worksheet to see the calculation of your self-employed retirement deduction.