How can I fix 401k over contribution? The tax year was over and I understand there are double tax issue, how do I make the correction in TurboTax this year?

Forum|Forum|2 years ago
December 29, 2023
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TurboTax Online

Best answer by dmertz

If your 2021 tax return did not include the excess elective deferral in your wages on Form 1040 line 1 (in addition to the amounts shown in box 1 of your Forms W-2), you must amend your 2021 tax return to include that and pay the additional tax. There is nothing else to fix.

dmertz

Employee

There is nothing more for you to do about an excess deferral made for ~~2022~~ 2021 that was not corrected. It was reportable as income on your ~~2022~~ 2021 tax return and it will be taxable again when you eventually take regular distributions from the 401(k). Nothing about this excess goes on your 2023 tax return or any future tax return.

veyd271119Author

Hi, do you mean there is no action item at this tax filing this year. The over contribution was in 2021 and not reflected in the filing in 2022 (I guess that is the same situation as it were in 2022 and not reported in the filing in 2023). Since the tax year was over, I wonder how this should be fixed and if it is fixable in TurboTax when I file the 2023 tax return? I heard that the over contribution would be taxed twice, is that doable in TurboTax? Thank you.