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Excess contribution to 401K in 2018 not refunded by April 15, 2019

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Excess contribution to 401K in 2018 not refunded by April 15, 2019

If you are unable to have your excess 401(K) Contribution refunded by 4/15/19, it will be taxed twice.....once on your 2018 Tax Return and then again in the future when you withdraw the funds.  Check out IRS Pub 525 for more details:  https://www.irs.gov/pub/irs-pdf/p525.pdf.

You should report the excess contributions to your 401(K) as Wages on line 1 of your 2018 Tax Return by following these steps: 

  • Click on the "Federal Taxes" Tab
  • Click on the "Wages & Income" Tab
  • Click on "I'll choose what I work on"
  • Scroll down to "Less Common Income"
  • Select "Miscellaneous Income" and click Start or Update
  • Select "Other income not already reported on a Form W-2 or Form 1099" and click on Start
  • Answer the Question "Did you receive any other wages?  Yes
  • Click through the questions until you get to "Any Other Earned Income"
  • Answer Yes to "Did you earn any other wages?
  • Indicate "Other" as Source of Other Earned Income and click Continue
  • For the description enter "8Excess 401K Deferrals" and click on Done
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