2024 1099-R (excess contribution)

Jama2 — Tue, 01 Apr 2025 20:35:38 GMT

I left a company in 2024, and rolled over the 401k (held at Fidelity) to a Rollover IRA (held at Fidelity) and was issued a 2024 1099-R. I filed my 2024 tax return and received a refund. Several weeks later, I receive a letter from Fidelity that there were excess matching contributions that should have been forfeited to the Plan rather than distributed to me (i.e. Fidelity 401k should not have distributed those funds to me and Fidelity 401k made a mistake).

Fidelity 401k then issued two corrected 2024 1099-Rs in my 401k account:

1) Corrected 2024 1099-R $8,060.10 with distibution code G (Direct rollover of a distribution to a qualified plan, a seection 403(b) plan, a government section 457(b) plan, or an IRA).

2) Corrected 2024 1099-R $1,174.94 with distribution code E (Distributions under Employee Plans Compliance Resolution System (EPCRS)).

Since the 401k had been rolled over to a Fidelity Rollover IRA, I requested the excess contributions from the Fidelity Rollover IRA. Fidelity recalculated the distributions and instead of distributing $1,174.94 per the corrected 2024 1099-R issued in the 401k account, they distributed $1,245.64 from my personal IRA. They have stated that the $1,245.64 distribution will be reported on IRS Form 1099-R, which will be mailed to me January 2026.

I need to file an amended tax return for 2024, and would appreciate guidance on how to do so. Do I need to wait until I get the 2025 1099-R from Fidelity in January 2026 to file the amended tax return for 2024? The excess contributions in 2024 were withdrawn before the 4/15/2025 deadline, so will I need to file a Form 5329 (Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts)?

How do I file an amended tax return for 2024, without waiting for the 1099-R from Fidelity in January 2026? I do not know what tax codes they will use in the distribution code. Because Fidelity distributed a different amount ($1,245.64) from my Rollover IRA instead of the amount per the Fidelity 401k 2024 1099-R of $1,174.94, will there be any issues?

I am trying to file an amended tax return due to the issues that the Fidelity 401k team caused when they inaccurately distributed the matching contributions that should have been forfeited to the Plan, causing this excess contribution issues. Thank you for the help!

Re: 2024 1099-R (excess contribution)

DanaB27 — Sun, 06 Apr 2025 13:42:06 GMT

It seems you had earnings on your excess contribution and therefore, you received more than $1,174.94. The earnings will be taxable in the year the excess contribution was made.

You should receive a 2025 Form 1099-R with codes P and 1 for the return of excess contribution plus earnings from the Traditional IRA.

To create a Form 1099-R in your 2024 return please follow the steps below:

Login to your TurboTax Account
Click on the "Search" on the top right and type “1099-R”
Click on “Jump to 1099-R”
Answer "Yes" to "Did you get a 1099-R in 2024?"
Select "I'll type it in myself"
Box 1 enter total distribution (contribution plus earning)
Box 2a enter the earnings
Box 7 enter P and 1
Check the "IRA/ SEP/ SIMPLE" box
Click "Continue"
On the "Which year on Form 1099-R" screen say that this is a 2025 1099-R.
Click "Continue" after all 1099-R are entered and answer all the questions.
Continue until "Did you use your IRA to pay for any of these expenses?" screen and enter the amount of earnings under "Corrective distributions made before the due date of the return".

Please be aware, code P will say in the drop-down menu "Return of contribution taxable in 2023" you can ignore that since the follow-up question will tell TurboTax that it will be taxable in 2024.

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2024 1099-R (excess contribution)

Re: 2024 1099-R (excess contribution)