It depends whether the excess distribution was corrected.
See this explanation from the IRS: Consequences to a participant who makes excess deferrals to a 401(k) plan:
Unless timely distributed, excess deferrals are
(1) included in a participant’s taxable income for the year contributed, and
(2) taxed a second time when the deferrals are ultimately distributed from the plan. See IRC Sections 402(g)(1) and 402(g)(2) and Reg. Section 1.402(g)-1(e)(2).
A participant who fails to receive a distribution of the excess deferrals does not receive basis in his pre-tax deferral account equal to the amount of excess deferrals. See IRC Section 402(g)(6).
The amount of the excess deferral will not be taxed twice if a corrective distribution is made.
