Guest ehayes Posted April 23, 2002 Share Posted April 23, 2002 i have a 401k plan with a 9/30/01 year end that failed the adp test. excess contributions will be distributed in april 2002. how should box 7 of form 1099r be coded? what is tax implication to participants. Link to comment Share on other sites More sharing options...
Fredman Posted April 23, 2002 Share Posted April 23, 2002 Because you are beyond the 2.5 month after plan year end deadline... Participants should get a 2002 1099-R with an '8' in box 7. This means taxable in the current year or 2002. Distribution is not eligible for rollover and not subject to 10% early withdrawal penalty. As a side the note, the client will also need to pay a 10% excise tax on the refunds and file form 5330. Link to comment Share on other sites More sharing options...
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