Reply To: 401k Over-Contribution – Which Tax Year(s) Apply?

Home Fairmark Forum Retirement Savings and Benefits 401k Over-Contribution – Which Tax Year(s) Apply? Reply To: 401k Over-Contribution – Which Tax Year(s) Apply?

#77468
Kaye Thomas
Moderator

The double taxation issue you’ve read about relates to a situation where contributions made as a reduction in your salary (called elective deferrals) go over the limit for that type of contribution, which in 2020 was $19,500 or $26,000 depending on whether you were at least age 50 in that year. Normally this happens only when someone has two different employers in the same year, as these plans are designed to prevent participants from exceeding the elective deferral limit.

The situation you describe does not involve an excess elective deferral: it had to do with the company match rather than contributions from your salary. The requirement to correct by April 15 does not apply, and double taxation is not an issue. Your 2020 return is not affected.