Because the excess was not corrected by April 15, 2024, the excess deferral is taxable on your 2023 tax return and does not create any basis in after-tax contributions in your 401(k). Assuming that you do nothing else to create basis in after-tax contributions in the 401(k), such as making explicit after-tax contributions (if the plan permits) or paying back a defaulted 401(k) loan, all of your regular distribution, early or normal, made in the future will be entirely taxable. The double taxation results from any regular distribution being taxable in addition to the excess being includible in income on your 2023 tax return. Nothing can be done to change that now.
