Hello,
In 2023 I exceeded the $22,500 contribution limit between my Roth TSP and Roth 401(k) accounts. The good news is that I was able work with my plan administrator to pull the excess contributions from my Roth TSP before the April 15 deadline.
However, I am unsure how this will affect my 2023 tax filing. Will I need to fill out a 1099R for 2023 or for 2024? Will I be taxed or penalized for over contributing? What should I do with the excess deferral?
This has no effect on your 2023 filing. Any attributable investment gains required to accompany the returned contribution will be taxable on your 2024 by entering into 2024 TurboTax the 2024 Form 1099-R that you will receive near the end of January 2025.
The original W-2 has already been provided to the IRS by your employer, so you must enter the original W-2 as received so that agrees with what has already been provided to the IRS. The W-2 must reflect the state of your employee contributions as of December 31, 2023. The plan will use Form 1099-R to report to you and to the IRS the corrective distribution that occurred in 2024, so the IRS will know that the excess contribution was corrected.
This has no effect on your 2023 filing. Any attributable investment gains required to accompany the returned contribution will be taxable on your 2024 by entering into 2024 TurboTax the 2024 Form 1099-R that you will receive near the end of January 2025.
Thank you so much! How will this affect my W2 when filing? Currently, Box 12 shows the excess deferral amount but if this is being refunded then should I leave box 12 blank?
Will I need an amended W2 or am I leaving the excess deferral amount in box 12 because it’s a roth account and it’s already been taxed?
I’m a little confused as to why I am reporting the excess deferrals in box 12 when I pulled the money out. I don’t want the IRS to think I have over contributed when the issue was resolved.
The original W-2 has already been provided to the IRS by your employer, so you must enter the original W-2 as received so that agrees with what has already been provided to the IRS. The W-2 must reflect the state of your employee contributions as of December 31, 2023. The plan will use Form 1099-R to report to you and to the IRS the corrective distribution that occurred in 2024, so the IRS will know that the excess contribution was corrected.