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Just received a check from Fidelity on the 401k over payment for 2018. Didn't receive any other paper with regards to the overpayment. How do I proceed now?
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posted
June 3, 2019
12:23 PM
last updated
June 03, 2019
12:23 PM
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Just received a check from Fidelity on the 401k over payment for 2018. Didn't receive any other paper with regards to the overpayment. How do I proceed now?
If you over-contributed to your 401(k), you have to report the excess contributions as wages on your 2018 tax return.
Page 10 of IRS Pub 525 under Excess deferrals (the IRS term for 401(k) contribution is deferral) tells us to include the excess deferrals as income on line 1 of Form 1040 if the money was returned after the end of the tax year but by April 15th of the following tax year. You need to report only the excess contribution, not any money generated by the investment of the excess contribution. What you earned will be covered by a 1099-R for the following tax year and will be entered then as a normal 1099-R.
Below is how to do this in TurboTax:
- Click on Federal in the left-hand column, then on Wages & Income
- Under All Income, scroll down to Less Common Income
- Select Miscellaneous Income and click Start
- 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 till 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 "2018 Excess 401K Deferrals" and click on Done
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June 3, 2019
12:23 PM
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