I'll admit it, I started my taxes late. I always use Turbo Tax and have had not issues. I changed jobs last year and rolled over my 401K into my new 401K. When I went to do my takes, I have an excess contribution to my 401K of $459. I contacted my plan administrator and they said I was past their April 4th deadline to be able to get that excess contribution returned to me. They said they can't do anything else for me and to contact a tax professional. What are my options now that I know I won't be able to get the money out before April 15? I've read some about the IRS taking away my 401K options and want to make sure that doesn't happen. I realize I'll have to pay taxes on the excess contribution but want to make sure I limit as much as possible what that will be and avoid any additional penalties that might affect my long term option of investing in a 401K. Thanks for any advice!
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Please follow these steps to report the $459 on your 2023 tax return in TurboTax Desktop:
You'll need to report the $459 as Other miscellaneous income. Nothing else needs to be done. The "penalty" will be that the $459 will be taxed a second time when eventually distributed as a regular distribution. (The excess deferral does not become after-tax basis in the 401(k)).
Please follow these steps to report the $459 on your 2023 tax return in TurboTax Desktop:
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