There are limits to the amount of elective deferrals to retirement accounts that can be made in a single year. If you do have a situation where too much has been contributed, it can be corrected in a timely manner.
The information in the following article from the IRS will give you more details:
Retirement topics - 401(k) and profit-sharing plan contribution limits
I get that but I am not over the limit based on IRS web side. However, TurboTax tells me that I overplayed 23,000 and I had to close one of my accounts! It is also issuing $129 penalty for overcontributing?! I had been using Turbo tax for about 7 years. I had never had this issue before. I had both of the accounts for about 5 years.
To clarify, the total contribution to your 401k and 403b is not more than $23,000? The combined contribution to the 401k and 403b cannot be more than $23,000 for 2024 if you are under 50.
Did you enter any IRA contributions?
You do not pay a penalty for overcontributing to a 401k/403b but you do pay a 6% penalty for excess IRA contributions.
Please be aware, if you made an excess deferral to the 401k/403b and do not take out the excess amount by April 15th, then you are taxed twice on the excess deferral left in the plan. This happens once when you contribute it and again when you receive it as a distribution. You can't include the excess amount in the cost of the contract even though you included it in your income.