Question

401k excess deferral mistaken as HSA excess?

Forum|Forum|4 years ago
April 12, 2022
1 reply
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I cover contributed to 401k in year 2020. I withdrew the excess in Feb 2021. But I didn't get the 1099-R form until Jan 2022. Hence the withdraw was not reflected in my 2020 tax return.

Now I'm using Turbotax Home and Business 2021 to prepare my year 2021 return. Turbotax read last year's tax file and realized I had excess contribution. However, Turbotax mistook it as HSA instead of 401k. It didn't give me the proper option to reflect the withdraw I've already made (see screenshot). How shall I handle this?

The other problem is - IRS corrected my 2020 tax return. But they gave very limited details (they corrected the total deduction amount). Now, if I want to file a 2020 amendment to reflect the excess 401k contribution, I'd have to fix the turbotax file first. Otherwise, the amendment would be based on "incorrect" tax file. This seems to be quite complicated. Is there a way I can reflect the 1099-R in my 2021 return instead of 2020? Thank you!

TurboTax Home & Biz Windows

M

mglauner

If you are amending your 2020 return, check your W-2 entries. Box 12 is used for both 401K Contributions and also HSA Contributions (Code D or Code W) to be sure it is correct, or doesn't contain both entries.

However, if the IRS corrected your 2020 return, you are just amending to transfer the correct info into 2021 TurboTax (unless they specifically instructed you to do so).

When you enter the 1099-R you received in 2022 in your 2020 return (should have Code P in Box 7), you will only be taxed on earnings in Box 2a.

Here's more info on Excess 401K Contributions.