My wife overcontributed to her 401k by $2800 due to a job change (2 different 401k providers in 1 year). We contacted the 401k provider and they sent us a check for $2690. The slip that comes with the check says that all of the $2690 is taxable and has no reference to "$2800" or gains/loss.
I called the 401k provider to ask why it was $2690 taken out and not $2800 as we requested. They said that they removed the gain/loss associated with the $2800 and the result was $2690 and that the "excess takes care of it" (???).
What do I put in my "Other Wages Received" section in Turbo Tax to account for this excess deferral? if I put $2690, we will still be $110 excess overcontributed technically. I could put the $2800, but I don't have documentation that it was $2800 taken out, since the slip only says $2690.
You should include the full amount of the 401(K) excess deferral, $2,800, as wages on your 2018 Form 1040.
On your 2019 Tax Return, you can include the $110 loss as a negative amount on Schedule 1, line 21 of your 2019 Form 1040. You can identify the loss as “Loss on Excess Deferral Distribution.”
To include your wife's overcontribution of $2,800 on your 2018 Tax Return, please follow these steps: