Not eligible for exclusion for those over age 59 1/2?

I am 64. I got a corrective distribution for excess 2019 contributions (refund) from my 401K in 2020. The notice says taxable distribution, can't be rolled over. Fed taxes were withheld but NYS taxes were not withheld on the distribution. Under "Where is this distribution from?" should I check off "Not eligible for exclusion for those over age 59 1/2?" What is "excluded" with that choice?

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1 Best answer

Expert Alumni

Feb 9, 2021 1:27:08 PM

Yes, select not eligible for exclusion for those over age 59 1/2 so this can be included as taxable income in your return.

Level 1

Feb 9, 2021 12:05:18 PM

It means Excluded from taxable income. If you receive a refund, you must include the refund as taxable income in the year it was received, the 59 1/2 rule doesn't apply here.

Level 2

Feb 9, 2021 1:11:58 PM

Thanks. So with respect to the TurboTax page, I SHOULD select the "Not eligible..." bullet, correct?

Expert Alumni

Feb 9, 2021 1:27:08 PM

Yes, select not eligible for exclusion for those over age 59 1/2 so this can be included as taxable income in your return.

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Not eligible for exclusion for those over age 59 1/2?