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how to handle discrepancy in overfunded 401k refund

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  • how to handle discrepancy in overfunded 401k refund

    I have a primary job with a 403b that I contribute maximally. I started a moonlighting gig in 2018 where unbeknownst to me they auto enroll you in their 401k. I noticed the contribution in my first paycheck and immediately stopped. $42 dollars was contributed. I reached out the financial institution for a refund of over contribution. They sent me a check for $25.75. They subtracted the annual account fees which lead to the discrepancy.

    I was reading in Turbo tax and there is a mechanism to report over contribution as taxable income: https://ttlc.intuit.com/questions/4448631-how-do-i-report-the-refund-that-i-received-after-over-funding-my-401k

    Is this going to raise a red flag if the refund is less the contribution?

  • #2


    Is this going to raise a red flag if the refund is less the contribution?
    Click to expand...


    probably not as youll still be credited the income on your W2.

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    • #3
      No. Since they refunded in the same year, there w/b no 1099R and, as @peds said, it will be added to your W2. Curious as to whether they add the $42 or the amount they gave you. That was really tacky to take out the annual fee, but I would imagine their argument would be that you didn't read the fine print. Fortunately, not a lot of $.
      Our passion is protecting clients and others from predatory and ignorant advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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