tertue

My main concern is that the 25% deduction for ER contributions "seems" to be way over th 25% when the ER contributions and EE deferrals are altogether on the same line...if that makes sense. Wouldn't the IRS see that and think for instance that $20K is a lot more than 25% of $50k compensation?

So does it matter if the elective deferrals go on line 12/13 as part of the gross compensation or line 23 as part of pension? When I called the IRS the agent said that if it wasn't part of line 12 or 13 then it would go on line 23. Which leads me to believe there is not a definitive answer. Anyone else out there want to give their opinion....or should we take a poll to see where all you 1120 filers put the elective deferral amounts? Sorry, I just like everything to be done right.

Where are employEE elective ccounted for/deducted on a C Corps 1120? For example, if an employEE defers $10K of the $50K....where is it deducted on the 1120? Would it be counted in with the pension deductions on line 23 (in other words, lumped in with employer contributions from profit sharing, matching, etc) or would the gross amount ($50K) go on line 13.

A C Corp business year end is 5/31 and the 401k plan is on a calendar year - do I use compensation paid on the W2 for the calendar year or compensation paid from 6/1 to 5/31 to compute the 25% employer contribution? What if the C Corp business year end is still 5/31, but the 401K plan year also ends 5/31? What compensation amounts would I use in this case? Where in the 401k plan document does it spell out the plan year (mean the plan year end)?