1099-R Information as applied to my 2017 Taxes

Submitted by Rodger Sands on Fri, 2018-04-06 23:09

I’m over 55 and I over contributed to two different 401k plans in 2017 when I worked at two different companies. The first plan was all Pre-Tax contributions (about $21,000) and the second plan (with my current employer) was about $4000 pre-tax contributions and $6000 after-tax contributions. For my current employer, both the pre-tax and after-tax contributions went into the same 401-k plan. I contacted my second plan administrator in late March of 2018 and they have just withdrawn the excess money and supplied me the distribution amounts. I won’t actually get the official 1099-R form until early 2019, but I know I need to show some of this over contribution and return of money on my 2017 taxes. I’m just not sure exactly what I need to enter for 2017?

The information I received from the Plan Administrator was as follows:

IRS Code 8B Taxable Amount $517
IRS Code P Taxable Amount $3,898
IRS Code PB Non Taxable Amount $2,364

When I looked up some of the codes, code 8 seems to indicate over contributions in 2017 (which I assume was from the pre-tax contributions). Code P seems to be indicate taxable in 2016, but that’s what is confusing since all the over contributions occurred in 2017 and any profits I would have made would be in 2017 and 2018 (not 2016).

With the above information and my explanation of what occurred, can someone advise on what I need to declare on my 2017 tax forms for this over contribution? I assumed I would need to declare just the over contribution amount on my 2017 taxes and then declare any profits I made on the over contribution amounts on my 2018 taxes.

Thanks for any advice,

Rodger



Submitted by Alan - IRA critic on Sat, 2018-04-07 01:31

  • 3898 should automatically be added to your 2017 wages line 7 when you enter your W-2 forms as that was the amount that reduced your Box 1 wages on the W-2. The 2364 was Roth deferrals which are already in your Box 1 wages. The 1099R codes presume a 2018 1099R issued in Jan, 2019, so code P means the income is taxable on your 2017 return. Code 8B is the earnings on the Roth contribution, so the 517 will be taxable on your 2018 return
  • Surprising that there is not a code 8 distribution also for earnings on the pre tax excess deferral. Any chance you missed a 1099R? Of course code 8 would go on your 2018 return.
  • This might be handled differently in tax programs, so the above is what the 1040 should look like. You may have to experiment to get the desired output. 
  • NOTE: There are two types of after tax deferrals, Roth and non Roth. Code B indicates that yours were Roth so you should refer to them as excess Roth 401k deferrals. Your plan must be using an apportionment method to determine the amounts to be returned from each type of deferral.

Submitted by Rodger Sands on Sat, 2018-04-07 03:37

Thank you for taking the time to answer my questions. No, I have not seen any other 1099R Forms and I’m not expecting to see one (since this excess contribution payment just happened this week). I got the above numbers from the investment company that is distributing me back the excess contribution. The numbers and codes were pulled directly from their website that showed these distributions. Their website didn’t have any official tax forms (1099R) yet for this distributions and I’m not expecting to see them until next January.  The after-tax contributions were going into a 401k Roth plan.    

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