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toomanyusernames
Returning Member

Individual 401k excess in 2019, refund in 2020

 

I am salaried employee with a company but I also do some self-employed work and I have an individual 401k (started earlier when I was an independent contractor).

 

In Dec 2019 I made a $3000 contribution to my solo 401k as a salary reduction.  This month I discovered part of it was excess, so I decided to do a complete refund.

 

How do I enter this in TurboTax?

 

Do I enter the $3k contribution in the Self-Employed Retirement Plans section as usual, then enter $3k as Other Earned Income similar to what this post says.

 

If this is the correct way to do it, does anyone know if I can e-file my return, or will I have to file paper?

5 Replies
MaryK4
Expert Alumni

Individual 401k excess in 2019, refund in 2020

@toomanyusernames  In your specific case (because it was the Solo401k) you can just remove the entry in the Self-Employment Retire Plans sections.  Please note- if this terminates the Solo401k there are separate forms you need to file with the IRS not related to this individual income tax return.

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toomanyusernames
Returning Member

Individual 401k excess in 2019, refund in 2020

Thanks.  I received the refund already but it was labeled as "Distribution - refund of excess".  Are you saying I don't need to enter this as a 401k distribution?

RobertG
Expert Alumni

Individual 401k excess in 2019, refund in 2020

If you received a 1099-R for the distribution you need to report it on your return. Make sure the distribution code on the 1099-R is correct for your distribution.

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toomanyusernames
Returning Member

Individual 401k excess in 2019, refund in 2020

I made the contribution in Dec 2019, I got the refund this month Jan 2020.  I won't get the 1099R until next year, right?

DanaB27
Employee Tax Expert

Individual 401k excess in 2019, refund in 2020

Yes, you are correct you won't receive the 1099R until next year.

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