Hi DanaB27,
Thank you for the detailed steps on how to report the 401(k) excess contribution withdrawal as Other Earned Income in TurboTax. I really appreciate your guidance.
I have a few additional questions regarding this topic:
It appears that TurboTax has applied a 10% tax to this amount. I believe this represents the tax on the excess contribution rather than a penalty. Is my assumption correct?
The withdrawn excess contribution, along with my spouse’s IRA amount, has been transferred into a new Roth IRA under my spouse’s name. Should this be reported in the 2024 or 2025 tax return? Additionally, should I expect to receive a Form 1099-R for this transaction?
I would appreciate your advice on these points. Thanks
