- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Report Inappropriate Content
Get your taxes done using TurboTax
There is nothing you can do to resolve it since you didn't remove the excess by April 15th, 2024.
You do not pay penalties for an excess to a 401k the 6% penalty only applies to IRAs.
Your "penalty" is that you will be taxed twice on the excess left in the plan since you did not take out the excess amount by April 15th, 2024. This happens once when you contribute it and again when you receive it as a distribution. You can't include the excess amount in the cost of the contract even though you included it in your income.
The first amounts distributed from the designated Roth account are treated as distributions of excess deferrals and earnings until the full amount of those excess deferrals (and attributable earnings) are distributed. These distributions will be taxable.
**Mark the post that answers your question by clicking on "Mark as Best Answer"