@Joesanko wrote:
Is TURBOTAX smart enough to generate this new 1099R for the excess 401k contribution amount, while I do the Tax-Return-2023. ?
(I am currently working on my 2023 tax return, being very late)
The help on TurboTax is not saying anything like that, but it never suggested anything about creating a new manual 1099R either. I do not want this to be doubled, if I do one on top of the automated one, if any.
There is no 1099-R. Re-read the instructions above. You can't remove the contribution, it's too late. So there won't be a 1099-R. You just leave the money in the 401k plan.
The consequences are,
1. Because the excess deferral reduced your taxable income you have to add it back to your taxable income as "other income." @dmertz gave you the procedure.
2. When you withdraw money in the future (usually retirement) you will pay tax like any other 401k withdrawal, meaning this part of your account will be taxed twice, once now and again when you withdraw. That's just how it will be.
