You have until 05/17/21 to remove the excess contributions and earnings to avoid a penalty. If you don't remove it, add the excess contributions back to your wages.
To add your excess 401(K) contribution to your wages:
- Sign in to TurboTax and open or continue your return.
- Select the Federal Taxes tab.
- Go to the Wages & Income tab.
- Select I'll choose what I work on.
- Go to Less Common Income and select Show More.
- Go to Miscellaneous Income and then select Start, Update or Revisit.
- Select Other income not already reported on a Form W-2 or Form 1099 and then select Start.
- Answer Yes to the question Did you receive any other wages?
- Select Continue through the questions until you get to the screen, Any Other Earned Income.
- Answer Yes to Did you earn any other wages?.
- Indicate Other as the Source of Other Earned Income and select Continue.
- For the description, enter 2020 Excess 401(K) Deferrals and select Done.
What if I have a 401(k) excess deferral? @Toyinb1
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