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Returning Member
posted Jun 4, 2019 8:37:22 PM

W-2 & W-2G Summary: Elective deferrals is more than allowed. How do I file with this being the situation?

I worked for two companies who both took out 401k deductions.  The total for the two W2's for box 12b adds up to $25,106 which is more than the allowed $24,500.  The Smart Check is asking me to check my entries.  The entries are correct and the total for 12b is $25,106.  Do I just ignore the warning and process my return?

  

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1 Best answer
Expert Alumni
Jun 4, 2019 8:37:23 PM

If you deferred more than $24,500, you should contact one of the Plan Administrators to distribute the excess amount by April 15, 2019, or you will end up being taxed on this money twice.  See Page 10 of IRS Pub 525 for more details on "excess contributions" and how they are handled: https://www.irs.gov/pub/irs-pdf/p525.pdf

You need to report the excess contributions to your 401K on Line 1 of your 2018 Tax Return by following these steps: 

  • Login to your return
  • Click "Take Me To My Return"
  • Click "Federal" on the left side of your screen
  • Scroll down to "Less Common Income" (You may need to click "Show All" to get this option to pop up)
  • Select "Miscellaneous Income, 1099-A, 1099-C" and click "Start or Update"
  • Select "Other income not already reported on a Form W-2 or Form 1099" and click on "Start"
  • Answer "Yes" to the Question "Did you receive any other wages?" 
  • Click "Continue" through the questions until you get to the section "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", enter the amount, and click on "Done"
Note: There is currently an e-file issue related to excess deferrals.  For more details click here:  Excess 401(k) Contribution Preventing E-filing.

4 Replies
Expert Alumni
Jun 4, 2019 8:37:23 PM

If you deferred more than $24,500, you should contact one of the Plan Administrators to distribute the excess amount by April 15, 2019, or you will end up being taxed on this money twice.  See Page 10 of IRS Pub 525 for more details on "excess contributions" and how they are handled: https://www.irs.gov/pub/irs-pdf/p525.pdf

You need to report the excess contributions to your 401K on Line 1 of your 2018 Tax Return by following these steps: 

  • Login to your return
  • Click "Take Me To My Return"
  • Click "Federal" on the left side of your screen
  • Scroll down to "Less Common Income" (You may need to click "Show All" to get this option to pop up)
  • Select "Miscellaneous Income, 1099-A, 1099-C" and click "Start or Update"
  • Select "Other income not already reported on a Form W-2 or Form 1099" and click on "Start"
  • Answer "Yes" to the Question "Did you receive any other wages?" 
  • Click "Continue" through the questions until you get to the section "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", enter the amount, and click on "Done"
Note: There is currently an e-file issue related to excess deferrals.  For more details click here:  Excess 401(k) Contribution Preventing E-filing.

New Member
Jun 4, 2019 8:37:25 PM

you cannot efile this at all at the moment. This is a screw up by Turbotax and they refuse to fix this. So it's best to return your product and get your taxes done else where

New Member
Jun 4, 2019 8:37:26 PM
New Member
Jun 4, 2019 8:37:28 PM

Do you do the above plus also file 1099-R along with 4582 ? What if one have not received the 1099-R. ?