The return of excess must be reported on your 2017 tax return as line 7 wages. If, while while the excess was invested in the 401(k), the investment had any earnings then those earnings must also be returned. The 401(k) administrator must figure out the earnings, if any. They will report the return of contribution on a 2018 1099-R with a code P in box 7 to report on your 2017 tax return and a separate 1099-R with a code 8 in box 7 to report the earning (if any) on your 2018 tax return next year.
You do not need the 1099-R with the code P to enter that part of it now, if you know the amount and you can ignore the 1099-R with the code P when it comes in 2019.
In what year was the excess deferral made and what year was it returned? Were any earnings returned?
Thanks for reply. Excess was made in 2017; I expect a check from 401K within the month. No earnings 'returned' - not sure what that means.
The return of excess must be reported on your 2017 tax return as line 7 wages. If, while while the excess was invested in the 401(k), the investment had any earnings then those earnings must also be returned. The 401(k) administrator must figure out the earnings, if any. They will report the return of contribution on a 2018 1099-R with a code P in box 7 to report on your 2017 tax return and a separate 1099-R with a code 8 in box 7 to report the earning (if any) on your 2018 tax return next year.
You do not need the 1099-R with the code P to enter that part of it now, if you know the amount and you can ignore the 1099-R with the code P when it comes in 2019.