The deadline has passed for many financial institutions to distribute excess contributions. Since you were unable to have the excess contribution removed by 4/15/19, you will be taxed twice on the amount, once in 2018 and once when you withdraw the money at retirement. For more information, check out Page 10 of IRS Pub 525: https://www.irs.gov/pub/irs-pdf/p525.pdf.
You should report the excess 401(K) contribution on Line 1 of your 2018 Tax Return by following these steps in TurboTax Desktop:
- Open your
return
- 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" and
click "Show More"
- 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
"Continue" 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 "2018 Excess 401K Deferrals" and
click on "Done"
NOTE: There is currently an e-filing issue within TurboTax related to excess contributions so you will need to mail in your return. You can check out this TurboTax FAQ for more information: Excess 401(k) Contribution Preventing E-filing.
