Need help with my 401K situation

Google ohboy!
Sep 9 17 Comments

So IRS has pre-tax 401k limit of $19000. I joined Google this year around May.

Both Google and my previous employer do 50% match of pre-tax/Roth 401K.

I have contributed $12,000 pre-tax with my previous employer, but it only matched $8000 of that (i.e. $4000).

I am now able to contribute only the rest $7000 at Google. Which means no match on the $4000 over-contribution I did at my previous job, i.e. $2000 down the drain.

How can I fix it ? Is it possible for me to withdraw $4000 from my previous employer's 401K account so that I can contribute that at Google ? Will IRS penalize if I do that ? (I haven't filed the taxes for this year, so guess not ?). Please help !

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TOP 17 Comments
  • Gen!x / Eng
    ixptl12

    Gen!x Eng

    PRE
    startups, JPMorgan Chase
    BIO
    ¯\_(ツ)_/¯
    ixptl12more
    Over-contribute at new employer. Put in $19k if you can. Withdraw excess contribution before Mar 15 next year.

    See IRS Form 1099-R
    Sep 9 11
    • Google / Eng d3j88wq
      I'd ask a financial advisor if Google search doesn't help
      Sep 9
    • Google ohboy!
      OP
      This is interesting, thanks for the suggestion.

      @ixptl do you know if it’s legal ?
      Sep 9
    • Google ohboy!
      OP
      I did Google search, it says as long as you withdraw the excess contribution before April 15th, you are good.

      Doesn’t say anything else
      Sep 9
    • Google exp.
      There’s no penalty on excess contribution. It’s not “early withdrawal”, it’s just getting money back and paying taxes to fix the error.

      Fully legal. Just do it before the deadline in 2020. TurboTax wasn’t able to handle this though, so I had to work with a person from H&R.

      There might be some back and forth with your ex employer and bank managing your 401k, but it’s doable. They might try telling you “you are supposed to do this with the second employer” but it’s BS, so stand your ground.
      Sep 9
    • Gen!x / Eng
      ixptl12

      Gen!x Eng

      PRE
      startups, JPMorgan Chase
      BIO
      ¯\_(ツ)_/¯
      ixptl12more
      There’s literally an IRS form for this.

      Do you know the IRS to create forms for illegal transactions?

      Seriously folks, just Google the IRS form 1099-R.
      Sep 9
  • Yahoo / Eng TC or GTF0
    I think if you contribute X then withdraw X, you have still contributed X for that year in the eyes of the IRS and you would owe tax plus penalties on the withdrawal.
    Sep 9 2
    • Qualcomm / Eng dynasty001
      Yes this is correct
      Sep 9
    • Gen!x / Eng
      ixptl12

      Gen!x Eng

      PRE
      startups, JPMorgan Chase
      BIO
      ¯\_(ツ)_/¯
      ixptl12more
      No. It is not.
      Sep 10
  • Google larry@
    I was in the same shoes. I over contributed at google, then try withdraw from my old employer. I was told that I couldn’t withdraw b/c the plan is not active any more. So I ended up withdrawing the overcontributed fund from google. Sad.
    Oct 13 0
  • Microsoft Vbsm66
    I have the same issue except I already contributed the full 19K amount. Is there some way I can withdraw and re-contribute at my new company?
    Sep 9 0

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