Financial Products

Financial Products

Questions about financial product options? Find discussions around a wide variety of financial service products here. Looking for your first debit card or a seasoned saver looking for tips to build your bank account, this is a great place to share and learn.

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Pioneer
Posts: 2
Registered: ‎03-16-2018

401k deduction entered on W2

I entered the 401k contribution from the employer's W2.  Do I need to enter that information also in the "Your Income Adjustments" in the tax software?

Pioneer
Posts: 2
Registered: ‎03-16-2018

Re: 401k deduction entered on W2

This is from the help files:

 

Elective deferrals to a 401(k) plan, Section 457 plan, SIMPLE plan, or the federal Thrift Savings Plan. You should see these on your W-2.

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Council Member
Posts: 516
Registered: ‎04-06-2016

Re: 401k deduction entered on W2

No, just enter them where you enter your W-2 income. 

 

The amount you contributed to your 401k will already be subtracted from your compensation by your employer before it's entered in Box 1 of your W-2.  If you don't have any other pre-tax deductions from your wages you'll likely notice that the difference between Box 1 and Boxes 3 and 5 is the amount of your 401k contributions.  This is because you have to pay medicare and social security taxes on the full amount of your compensation, including the amount you contribute to your 401k, but because you're deferring the income that you contribute to a 401k, it's not considered in your wages for income tax purposes (Box 1). 

 

Karen