401K Overcontribution Correction tax-rate

IBM
Nrxx72

Go to company page IBM

Nrxx72
Feb 14 6 Comments

Hi All,
For correcting a 401K overcontribution, whats the tax rate you normally enter (if any) in the form. Fidelity normally states the normal rate they take out (if we dont give a %) is 20% (federal), we have the option to enter a federal and a state tax % in their forms. Any thoughts on this here?
#401k #taxes
Thanks

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TOP 6 Comments
  • Roblox
    LoongView

    Go to company page Roblox

    LoongView
    Don't sweat it. At the end of the year your overcontribution will be treated as income and taxed accordingly when you file your tax return.
    Feb 14 3
    • Roblox
      LoongView

      Go to company page Roblox

      LoongView
      Yup that will work just fine and usually the easiest way.
      In any case, you will probably either see this in your W2 or receive a W2C (corrected w2) with the correct numbers.
      Feb 14
    • IBM
      Nrxx72

      Go to company page IBM

      Nrxx72
      OP
      I was told the W2 is not corrected- instead, a 1099R form is added to the taxes. Not sure if i need to add it for this year's taxes or the next. -Actually if the earnings are for this year, i will have to add it for this year, or (if i dont receive it by Apr 15) file an amendment
      Feb 14
  • Amazon / Eng
    wawY45

    Go to company page Amazon Eng

    PRE
    Apple
    BIO
    I'm a no-man.
    wawY45
    That must simply a tax rate for withholding. Doesn't really matter.
    Feb 14 1
    • IBM
      Nrxx72

      Go to company page IBM

      Nrxx72
      OP
      Thanks -I plan to not enter a % for the withholding and let fidelity take out their standard %. Then hope TurboTax will work out my return/refund when I file taxes.
      Feb 14