401 excess contribution withdrawn by the tax deadline

Forum|Forum|3 years ago
June 25, 2023
1 reply
17 views

Hi,

Client withdraw excess contribution to pre-tax 401K by tax deadline. No tax forms for it yet. How can I report this in Proseries?

ProSeries Basic

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qbteachmt

Level 15

The corrective distribution would have included the excess contribution and the earnings attributed to that amount. If the contributions were made pre-tax, the employer must issue a corrected W-2 for that tax year to show the excess deferral amount as taxable wages (in Box 12). This is June, so that should have already happened. The earnings are added to the taxable income for the year the excess amount is distributed, but that 1099-R won’t come out until after the end of this year, coded as applicable to the previous tax year. You can use the 1099-R input as if you have one in hand.

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ptax255Author

Level 6

I have no corrected W-2 or a 1099R. Client said he worked with the employer to withdraw the excess but they did not give him a corrected W-2. So what's the best way to enter it without one?

qbteachmt

Level 15

The 1099-R is for the year of removal, which is 2023. That won't arrive until Jan 2024.

The employer is responsible for a corrected W2. They, their Payroll processor, needs to provide it. It isn't a courtesy. It's a requirement.

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