Guest Taxlady1040 Posted March 7, 2014 Report Share Posted March 7, 2014 Sole proprietor with no employees made improper elective deferral of $17,000 to SEP/IRA on 2012 tax return. Employer contribution OK. Error discovered after October 15, 2013. Can I get a confirmation that this is the correct way to remedy this? Amend 2012 tax return and remove excess elective deferral of $17,000 from line 28 of 1040. Pay 6% excise tax on 2012 Form 5329. Include form and payment with 1040x. Excess contribution remains in the SEP/IRA account, and there are no reporting requirements on custodian's part to the IRS (other than the 5498 which reflects the total contributions made for 2012, including the excess contribution). Carry forward $17,000 to 2013 as a deduction, subject to the 25% limit . Is the 5329 the proper form to report and pay this 6% excise tax? If the $17,000 is completely applied on the 2013 tax return, does that mean there is no more 6% excise tax required to be paid? Link to comment Share on other sites More sharing options...
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