401k Overcontribution Questions

[Maverick_7]

Had a few 401k overcontribution questions for the community. Here's the situation:

• Since my wife had two employers in 2020 she overcontributed to her 401k that year. All contributions were Roth. In Jan. 2021 she identified the issue and the administrator of her more recent employer sent her a check that month for the excess contribution. When she later filed her taxes (single status for 2020) she used the W-2's that had been given to her, which still included the overcontribution amount in the 401k contribution figure in box 12 code AA of the more recent employer's W-2. Now in 2022 we are preparing to file MFJ for 2021 and received two 1099-R's related to this situation (one for the excess contribution, and one for the earnings on that excess amount while it was in the plan)

My questions are:

1. Does my wife need to amend her 2020 tax return?
2. Do the 1099-R's we received in early 2022 need to be captured in the CY2020 or CY2021 tax returns?
3. Does her change of marital status from single filer in CY2020 to MFJ in CY2021 impact this at all?

Thanks folks!

[macuser_22]

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@Maverick_7 wrote:

Had a few 401k overcontribution questions for the community. Here's the situation:

• Since my wife had two employers in 2020 she overcontributed to her 401k that year. In Jan. 2021 she identified the issue and the administrator of her more recent employer sent her a check that month for the excess contribution. When she later filed her taxes (single status for 2020) she used the W-2's that had been given to her, which still included the overcontribution amount in the 401k contribution figure in box 12 code AA of the more recent employer's W-2. Now in 2022 we are preparing to file MFJ for 2021 and received two 1099-R's related to this situation (one for the excess contribution, and one for the earnings on that excess amount while it was in the plan)

My questions are:

1. Does my wife need to amend her 2020 tax return?
2. Do the 1099-R's we received in early 2022 need to be captured in the CY2020 or CY2021 tax returns?
3. Does her change of marital status from single filer in CY2020 to MFJ in CY2021 impact this at all?

Thanks folks!

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What are the 1099-R box 7 codes on the 1099-R's.

[Maverick_7]

Overcontribution 1099-R - the code is "BP"

Earnings on overcontribution 1099-R - the code is "B8"

[Maverick_7]

Bump.

[DanaB27 · Accepted solution]

No, according to Pub 525 your wife won't need to amend her 2020 return since distribution for a 2021 excess deferral to a designated Roth account won't get added to the wages.

But the earnings need to be reported on your 2021 tax return.

No, your marital status won't affect this.

@Maverick_7