you are entering in your 3000 into Turbo Tax and you shouldn’t. The 401k deduction is already accounted for in your net income. If you look at your w-2 you’ll see that the social security income is at least $3,000 higher than the taxable amount. The difference is your 3k traditional 401k contribution.

Little confused when you say $4k limit for Roth 401k. That’s not true…the $4k limit is for all IRA’s not 401k’s. The limit for 401k’s is $15.5k and can be split any way between ROTH and Traditional. Either way it’s all accounted for in the w-2 and shouldn’t be entered into TurboTax at all.

IRA’s are totally different than 401(k)’s so make sure you aren’t combining the two terms.

There is the possibility that your employer offers a Roth 401(k) in addition to a regular 401(k). For 2007, the TOTAL maximum contribution to all 401(k) accounts was $15,500, or $20,500 if you are age 50 or older.

Sounds more like you contributed to two different self-directed IRA accounts outside your employers offerings. The TOTAL maximum amount across all types of IRA accounts was $4,000, or $5,000 if age 50 or older.

You apparently are claiming a total of $4,500 in IRA’s, which would make you younger than 50 if TurboTax is giving you a red-flag.

I would double-check your inputs into the program. Are you sure the $3,000 was in an IRA account or in an employer-managed 401(k) account (likewise for the $1,500 amount)? Or vice-versa? Those are input on different sheets in TurboTax.

I think you’re confusing 401(k) accounts with IRA accounts. They are different.

For 2007, the 401(k) limit is $15,500 (+$5,000 if 50 or older). The 2007 total IRA limit is $4,000 ($5,000 if 50 or older).