Hi,
When I contribute to 401K, will the part of the income I put into my
401K be reported as taxable income in my W2 and contribute to my adjusted gross income? I think the answer is no, am I right?The reason I am asking this question is to determine if I can increase my 401K to help me qualify for the hope tuition credit.
Thanks, Arvind
Correct. 401k contributions reduce your AGI. Be aware that your gross income before 401K deductions is still subject to social security and medicare.
Yes, that's a good strategy. You can increase your 401K contributions for other reasons as well, such as qualifying for the stimulus checks.
You are correct.
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