1099R code P - Excess contribution, now what?

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Topic Author
sdsu04
Posts: 83
Joined: Sun Nov 19, 2017 10:53 pm

1099R code P - Excess contribution, now what?

Post by sdsu04 »

Hello,

Due to an employer change and resulting over contrition to 401K, we received 1099R with a code "P" (in addition to another 1099R with code G for megaback door conversion we get every year). It's $161 and all of it is taxable ( $161 in box1 and in box 2a) on the 1099R coded P.

- I presume we have to amend the "prior year - 2022" tax return? In some posts (not mine) some people have commented that given the small amount this can be ignored, hence the question.

- I have never amended a return. We used TT for 2022 tax return (filed in 2023), presume I should go back to that version of TT and amend? We are using TT again this year (for 2023) and when I entered this 1099R it says we cannot use it an need to go back and amend a prior year return.

Thanks!
Alan S.
Posts: 12534
Joined: Mon May 16, 2011 6:07 pm
Location: Prescott, AZ

Re: 1099R code P - Excess contribution, now what?

Post by Alan S. »

sdsu04 wrote: Sun Feb 11, 2024 12:22 pm Hello,

Due to an employer change and resulting over contrition to 401K, we received 1099R with a code "P" (in addition to another 1099R with code G for megaback door conversion we get every year). It's $161 and all of it is taxable ( $161 in box1 and in box 2a) on the 1099R coded P.

- I presume we have to amend the "prior year - 2022" tax return? In some posts (not mine) some people have commented that given the small amount this can be ignored, hence the question.

- I have never amended a return. We used TT for 2022 tax return (filed in 2023), presume I should go back to that version of TT and amend? We are using TT again this year (for 2023) and when I entered this 1099R it says we cannot use it an need to go back and amend a prior year return.

Thanks!
Please confirm if the 161 was an excess deferral for 2022 and if it was returned by 4/15/2023. Or if you think the 161 was the amount of gain on the excess deferral, please advise.

You might also check your 2022 return to see if the wages line exceeds your Box 1 W-2 income by this amount. If it does, you already paid the tax on the excess with your 2022 return.
Topic Author
sdsu04
Posts: 83
Joined: Sun Nov 19, 2017 10:53 pm

Re: 1099R code P - Excess contribution, now what?

Post by sdsu04 »

Hello Alan!

This was excess deferral. We also filled a 402(g) excess deferral (return if excess contribution) form with fidelity when we identified this in March 2023 and this was returned to us in March 2023.

Sorry for the dumb question - I do not understand what I should check when you say “ check your 2022 return to see if the wages line exceeds your Box 1 W-2 income by this amount”. We have 2 W2 from the same employer and I am unclear what numbers I should compare in my w2 with what number in our tax return.
Alan S.
Posts: 12534
Joined: Mon May 16, 2011 6:07 pm
Location: Prescott, AZ

Re: 1099R code P - Excess contribution, now what?

Post by Alan S. »

sdsu04 wrote: Sun Feb 11, 2024 2:03 pm Hello Alan!

This was excess deferral. We also filled a 402(g) excess deferral (return if excess contribution) form with fidelity when we identified this in March 2023 and this was returned to us in March 2023.

Sorry for the dumb question - I do not understand what I should check when you say “ check your 2022 return to see if the wages line exceeds your Box 1 W-2 income by this amount”. We have 2 W2 from the same employer and I am unclear what numbers I should compare in my w2 with what number in our tax return.
Add up the Box 1 totals for both your W-2 forms and compare it to the figure on line 1a of your 2022 Form 1040. Is line 1a the same or is it higher by around 161?
Topic Author
sdsu04
Posts: 83
Joined: Sun Nov 19, 2017 10:53 pm

Re: 1099R code P - Excess contribution, now what?

Post by sdsu04 »

Alan S. wrote: Sun Feb 11, 2024 4:29 pm
sdsu04 wrote: Sun Feb 11, 2024 2:03 pm Hello Alan!

This was excess deferral. We also filled a 402(g) excess deferral (return if excess contribution) form with fidelity when we identified this in March 2023 and this was returned to us in March 2023.

Sorry for the dumb question - I do not understand what I should check when you say “ check your 2022 return to see if the wages line exceeds your Box 1 W-2 income by this amount”. We have 2 W2 from the same employer and I am unclear what numbers I should compare in my w2 with what number in our tax return.
Add up the Box 1 totals for both your W-2 forms and compare it to the figure on line 1a of your 2022 Form 1040. Is line 1a the same or is it higher by around 161?

Thanks! It is the same (not higher by 161).
Alan S.
Posts: 12534
Joined: Mon May 16, 2011 6:07 pm
Location: Prescott, AZ

Re: 1099R code P - Excess contribution, now what?

Post by Alan S. »

sdsu04 wrote: Sun Feb 11, 2024 5:09 pm
Alan S. wrote: Sun Feb 11, 2024 4:29 pm
sdsu04 wrote: Sun Feb 11, 2024 2:03 pm Hello Alan!

This was excess deferral. We also filled a 402(g) excess deferral (return if excess contribution) form with fidelity when we identified this in March 2023 and this was returned to us in March 2023.

Sorry for the dumb question - I do not understand what I should check when you say “ check your 2022 return to see if the wages line exceeds your Box 1 W-2 income by this amount”. We have 2 W2 from the same employer and I am unclear what numbers I should compare in my w2 with what number in our tax return.
Add up the Box 1 totals for both your W-2 forms and compare it to the figure on line 1a of your 2022 Form 1040. Is line 1a the same or is it higher by around 161?

Thanks! It is the same (not higher by 161).
Too bad. That means you will need to file an amended 2022 return to report the 161 as additional wages. Code P means the taxable year is 2022, the year of the excess deferral.

Was the excess amount due to your contributing to two different plans in 2022? If so, for such a small excess it probably would have been simpler to ignore it and leave it in the plan. Your 2022 tax bill would be the same, and the 161 would have eventually been taxed again, possibly many years in the future.
MarkNYC
Posts: 2961
Joined: Mon May 05, 2008 7:58 pm

Re: 1099R code P - Excess contribution, now what?

Post by MarkNYC »

sdsu04 wrote: Sun Feb 11, 2024 5:09 pm
Alan S. wrote: Sun Feb 11, 2024 4:29 pm
sdsu04 wrote: Sun Feb 11, 2024 2:03 pm Hello Alan!

This was excess deferral. We also filled a 402(g) excess deferral (return if excess contribution) form with fidelity when we identified this in March 2023 and this was returned to us in March 2023.

Sorry for the dumb question - I do not understand what I should check when you say “ check your 2022 return to see if the wages line exceeds your Box 1 W-2 income by this amount”. We have 2 W2 from the same employer and I am unclear what numbers I should compare in my w2 with what number in our tax return.
Add up the Box 1 totals for both your W-2 forms and compare it to the figure on line 1a of your 2022 Form 1040. Is line 1a the same or is it higher by around 161?

Thanks! It is the same (not higher by 161).
You should also check to see if the $161 was reported as income on line 1h instead of line 1a.
Topic Author
sdsu04
Posts: 83
Joined: Sun Nov 19, 2017 10:53 pm

Re: 1099R code P - Excess contribution, now what?

Post by sdsu04 »

Alan S. wrote: Sun Feb 11, 2024 8:12 pm
sdsu04 wrote: Sun Feb 11, 2024 5:09 pm
Alan S. wrote: Sun Feb 11, 2024 4:29 pm
sdsu04 wrote: Sun Feb 11, 2024 2:03 pm Hello Alan!

This was excess deferral. We also filled a 402(g) excess deferral (return if excess contribution) form with fidelity when we identified this in March 2023 and this was returned to us in March 2023.

Sorry for the dumb question - I do not understand what I should check when you say “ check your 2022 return to see if the wages line exceeds your Box 1 W-2 income by this amount”. We have 2 W2 from the same employer and I am unclear what numbers I should compare in my w2 with what number in our tax return.
Add up the Box 1 totals for both your W-2 forms and compare it to the figure on line 1a of your 2022 Form 1040. Is line 1a the same or is it higher by around 161?

Thanks! It is the same (not higher by 161).
Too bad. That means you will need to file an amended 2022 return to report the 161 as additional wages. Code P means the taxable year is 2022, the year of the excess deferral.

Was the excess amount due to your contributing to two different plans in 2022? If so, for such a small excess it probably would have been simpler to ignore it and leave it in the plan. Your 2022 tax bill would be the same, and the 161 would have eventually been taxed again, possibly many years in the future.
Got it, thanks! Yes we contributed to different plans as there was a change in employment.

I will have to figure out how to file an amended return on TT. Presume I open the 2022 program and it will show me how!
Topic Author
sdsu04
Posts: 83
Joined: Sun Nov 19, 2017 10:53 pm

Re: 1099R code P - Excess contribution, now what?

Post by sdsu04 »

MarkNYC wrote: Sun Feb 11, 2024 8:26 pm
sdsu04 wrote: Sun Feb 11, 2024 5:09 pm
Alan S. wrote: Sun Feb 11, 2024 4:29 pm
sdsu04 wrote: Sun Feb 11, 2024 2:03 pm Hello Alan!

This was excess deferral. We also filled a 402(g) excess deferral (return if excess contribution) form with fidelity when we identified this in March 2023 and this was returned to us in March 2023.

Sorry for the dumb question - I do not understand what I should check when you say “ check your 2022 return to see if the wages line exceeds your Box 1 W-2 income by this amount”. We have 2 W2 from the same employer and I am unclear what numbers I should compare in my w2 with what number in our tax return.
Add up the Box 1 totals for both your W-2 forms and compare it to the figure on line 1a of your 2022 Form 1040. Is line 1a the same or is it higher by around 161?

Thanks! It is the same (not higher by 161).
You should also check to see if the $161 was reported as income on line 1h instead of line 1a.
It is not. 1h is $0.
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