2025 excess 401k correction advice

[rhaasn6]

Without realizing, I exceeded the 23,500 401k limit. Please advise how to update all to get right and avoid unnecessary taxes.

Being over 65, I am wondering if the overage can be put into line 6c which is the catch-up line. The overage is under the catch-up limit.

If necessary, having the plan admin reduce out the difference but then does that require a new W2 and or at least updating the form in TT (getting a new W2 sent by them to IRS also)?

This would change my tax rate but could offset by the overage tax.

Better option:

When I put into the 6c, the red colors go away. What I don't know is if the W2 needs to change for this (a different letter code to identify as catch-up) or if it's all done by simply moving the amount to 6c.

Thanks in advance for good direction to simplify work and avoid tax complications.

[MinhT1]

If you are over age 50, you automatically have a catch up contribution of $7,500, bringing the allowed maximum contribution to your 401(k) plan to $31.000.

There should be no excess and TurboTax should accept your actual contribution. Contributions to your 401(k) plan are made through salary deferrals and are reported on your form W-2, box 12 with code D. They are not reported anywhere else on your form 1040.

Please check and comment here if you have further questions.

[rhaasn6]

In Reply:

Thanks, if all goes onto line 6a in TurboTax, it becomes red from the overage. Reducing the overage and putting it on 6c makes both accepted.

TT is not automatically allowing the 31,000 limit which I did not exceed. So, if acceptable to split it into the 2 cells, then this is settled. It also leaves the W2 alone.

It seems that splitting is acceptable and nothing else is needed. Since nothing identified the overage as catch-up, this may be semantics about where to put it by carefully reading. The more I read, the more it makes sense. An alert, caution or popup would be helpful to guide this rather than simply make it red and leave it for this discussion, etc., to figure out.

The end result works out without concern by splitting the values on 6a and 6c and as a lesson to watch out.

Thank you again