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Author: TMFPMarti Big funky green star, 20000 posts Home Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121219  
Subject: Re: Excess contribution to 401k Date: 4/6/2005 2:36 PM
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After speaking to my 401k plan administrator , they say that since I made the request on the 29th of march (after march-15th) they can't change the details in time for 2004 and hence the 1099-R that I receive will be for 2005 and hence I'll need to put in the 1099-R for the year 2005 returns and NOT 2004 .

For starters, forget about 1099-R's. What they say and when they're issued don't have any effect on the tax issues here. The tax treatment depends solely on whether you get a refund by 4/15/2005 or not, and nothing that happens now affects the 2004 tax treatment. Go back and read my first response for the correct tax treatment.

Is this an accurate statement ? In other words I don't do anything with this 1099-R now and only worry about using it , when I do my 2005 returns ?

If the money is refunded to you between 4/16/2005 and 12/31/2005 the refund will be 2005 income. If they can't refund it by 4/15 and you can stop the refund, you might just want to go ahead and let it build toward retirement. You won't have to pay the double tax until you withdraw the money.

Unfortunately, am using turbotax , so can't go an edit the amounts in Line 7 manually :(

Have you done the check I mentioned in my second response? If the W-2's were correctly prepared and transcribed to TT, TT has all the information it needs to put the correct figure on line 7.

If line 7 isn't correct, here are your choices:

1. Make up a W-2 for the excess.

2. Change the box 1 figure on one of your W-2's to include the excess.

IOW, if you can't figure out how to trick a computer, you shouldn't be using software.

Phil
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