Individual 401k excess in 2019, refund in 2020

Forum|Forum|6 years ago
January 23, 2020
1 reply
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I am salaried employee with a company but I also do some self-employed work and I have an individual 401k (started earlier when I was an independent contractor).

In Dec 2019 I made a $3000 contribution to my solo 401k as a salary reduction. This month I discovered part of it was excess, so I decided to do a complete refund.

How do I enter this in TurboTax?

Do I enter the $3k contribution in the Self-Employed Retirement Plans section as usual, then enter $3k as Other Earned Income similar to what this post says.

If this is the correct way to do it, does anyone know if I can e-file my return, or will I have to file paper?

MaryK4

Level 15

@toomanyusernames In your specific case (because it was the Solo401k) you can just remove the entry in the Self-Employment Retire Plans sections. Please note- if this terminates the Solo401k there are separate forms you need to file with the IRS not related to this individual income tax return.

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toomanyusernamesAuthor

Level 2

Thanks. I received the refund already but it was labeled as "Distribution - refund of excess". Are you saying I don't need to enter this as a 401k distribution?

RobertG

Level 12

If you received a 1099-R for the distribution you need to report it on your return. Make sure the distribution code on the 1099-R is correct for your distribution.

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