@Balak wrote:
Sorry for the confusion. I’m talking about excess contribution on the 401k. By brokerage I meant Fidelity. There are plenty of online articles that mention 6% penalty if the excess is not removed before April 15. TurboTax pop up also mentioned this 6% penalty if the excess is not removed before the tax day. It is not clear if this 6% penalty would only be one time OR each year until the excess stays in the account?
The 6% penalty applies to IRA's, not employer plans. Your 401(k) contributions are shown in box 12 on your W-2 and are NOT IRA contributions. Are you confusing them?
**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.**
