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Thanks again for your additional response. I understand your last paragraph; however, it is inconsistent with the corrected 2020 Form 1099-R from the original 401K provider and also inconsistent with the only 2020 W-2. Since the income totals are the same, I’m going to stick with using the data from the documents I have. If I do get audited, I can explain why I reported what I did and just change the line numbers for income without changing the total income reported.
While researching this topic, I realized that I reported income in the wrong tax year for a similar excess contribution 12 years earlier. At the time, I did not realize the meaning of code 1P in Box 7 of Form 1099-R. I’m surprised neither the tax software nor the IRS noticed it. I probably paid the same tax rate in both years so it was a wash for the IRS.
- This reply was modified 8 months, 3 weeks ago by deedee8712.