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Deductions & credits
To avoid a penalty going forward you need to withdraw the excess contribution. You can do this by taking a distribution from the pension plan for the amount of the excess contribution, or you can simply not make allowable contributions in the current or future years up to the amount of the excess contribution. For instance, if your excess contribution is $7,000 and you are allowed to make $7,000 in contributions for 2022, you can simply not make those contributions and you will have paid back your excess.
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‎January 27, 2023
5:43 AM