A 401(k) employer contribution for an employee belongs on Line 19, pension and profit-sharing plans.
Why line 19
Employer money going into a 401(k) for an employee, a match, a safe harbor contribution or a profit sharing allocation, is a business expense on line 19, which the Schedule C instructions describe as contributions to employee pension, profit-sharing and annuity plans. The employee's own deferral is part of wages and not an extra deduction. Your own contribution as the owner is a Schedule 1 item, so a solo plan with no one else in it leaves line 19 empty.
Stop looking up lines one at a time. ClaryBook totals your year into an IRS Schedule C worksheet in form order, Part I and Part II line by line, so a 401(k) employer contribution for an employee lands on Line 19 without you sorting it.
Start for freeWhat a 401(k) employer contribution for an employee is confused with
- Schedule 1 line 16, schedule 1 line 16, self-employed retirement plans
- If you are the only participant, the contribution is the owner's retirement deduction on Schedule 1 line 16 and line 19 stays blank.
- Line 26, wages
- Employee deferrals are already inside the gross wages on line 26, so adding them again on line 19 double counts the same dollars.
- Line 17, legal and professional services
- A third party administrator's fee is a plan cost rather than a contribution, so it is reported separately and not folded into the line 19 contribution figure.
Examples that belong on line 19
- $2,000 of safe harbor match for one employee
- $3,600 profit sharing allocation spread across two eligible employees
- $750 of employer match for a part time employee who became eligible in July
- $4,100 of employer contributions for staff, with the owner's own share going to Schedule 1
What does not belong here
- Your own deferral or employer contribution as the owner.
- Employee deferrals withheld from pay.
- Loan repayments an employee makes back into the plan.
The limit that applies
Contributions for a year are deductible if they are made by the due date of the return, including extensions.
What to keep
Keep the plan document and adoption agreement, the year end compliance testing or safe harbor notice, payroll reports, and custodian statements showing each deposit. Any required Form 5500 series filing belongs with them.
Other expenses on line 19
| Expense | Line |
|---|---|
| a retirement plan administration fee | Schedule C, Line 19 |
| a SEP-IRA contribution for an employee | Schedule C, Line 19 |
| a SIMPLE IRA employer match for an employee | Schedule C, Line 19 |
Related lookups
- Where does my own SEP-IRA contribution go?
- Can I pay my child and deduct it on Schedule C?
- Where do tax preparation fees go on Sch C?
Sources
This page explains how Schedule C lines work. It is general information, not tax advice for your situation. If an expense is large or the answer turns on a fact about your business, confirm it with your tax preparer.
Looking for a different expense? The full Schedule C line lookup has every line from 8 to 27 with the expenses that belong on each, and Schedule C expense categories walks the whole form in order.
Stop looking up lines one at a time. ClaryBook totals your year into an IRS Schedule C worksheet in form order, Part I and Part II line by line, so a 401(k) employer contribution for an employee lands on Line 19 without you sorting it.
Start for free