@fe7565 wrote:
@macuser_22 Thank you for the fast reply. I checked my 2019 filing for the TSP excess. I ended up including (via Form 4852) on 1040 Line 1 only the employee contribution and capital gains. That's because I figured that the TSP admin will take back their contributed/matched amount. Of course that did not happen because the 15 Apr 2020 deadlines passed. So I should have added the employer's Auto 1% + Matching contributions.
Do you think I should amend the 2019 tax return 1040 Line 1 to include the additional (about $1000) employer's Auto 1% + Matching contributions in addition to the employee contribution and capital gains already there? Or find a way to fix it with the 2020 tax filing (which I am working on now)?
ONLY the amount of your excess should have been reported. not any gains. You report the excess on the 1040 line 1 as wages because you received a wage deduction by the employer for your contributions so you are just putting it back. You did not receive any wage reduction for the gains or employer match. Since the excess and capital gains should still be in the account then you will be taxed again when the money is finally distributed. That double tax is the penalty for not removing it by the due date.
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
