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lcai69
Returning Member

Excess ADP 401K contribution in 2021, but got a 1099-R in 2022 with code 8 in box 7

Had an excess ADP 401K contribution of $7000 in 2021, but got a 1099-R in 2022 with code 8 in box 7. ADP issued the withdraw check on Dec 31, 2021. But the actual auto deposit by ADP happened on March 30, 2022. 

So, I ended up with additional income of $7000 in 2022, instead of 2021, since the code in box 7 of 1099-R issued by ADP is 8. Did ADP make an error, shouldn't the code in box 7 be P (which means tax in previous year - 2021)? 

 

If indeed ADP should have code P, does that mean I have to admend both 2021 (still OK to admend since I filed 2021 late anyway) and 2022? Do I have to pay panelty in 2021 for additional tax due because of ADP error? 

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3 Replies
dmertz
Level 15

Excess ADP 401K contribution in 2021, but got a 1099-R in 2022 with code 8 in box 7

You said that you got the Form 1099-R in 2022, which would seem to suggest that the form was a 2021 Form 1099-R that was reportable on your 2021 tax return, but the rest of your post seems to imply that the form was a 2022 Form 1099-R.  To be clear, which year is on the Form 1099-R?

 

Does the form show the same amount in box 2a as is in box 1?

 

How must investment gain or loss accompanied the distribution of the excess?

 

 

lcai69
Returning Member

Excess ADP 401K contribution in 2021, but got a 1099-R in 2022 with code 8 in box 7

Thank you for your reply.

 

The form is a 2022 1099-R Form (not 2021). The year of the form is 2022. But the excess happened in 2021, ADP even cut a check on the 12/31/2021, but show how ADP auto deposit in March 2022.

 

Box 2a and box 1 has the same amount.

 

How must investment gain or loss accompanied the distribution of the excess? -- unknown

dmertz
Level 15

Excess ADP 401K contribution in 2021, but got a 1099-R in 2022 with code 8 in box 7

I agree that it seems that the 2022 Form 1099-R should have had code P to indicate that the distribution was taxable in 2021 rather than in 2022.

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