10% excise tax penalty

[Guest lindamichals]

Refund was completed timely, however, was determined to be incorrect and requires a re-issue for a different amount. Would the refund then be considered late and subject to the excise tax penalty since the corrected refund is past March 15th?

[ETA Consulting LLC]

Technically, yes. But only the increased amount would be considered late and subject to the penalty. That would appear to be the most consistent approach.

Good luck!

[Guest lindamichals]

Technically, yes. But only the increased amount would be considered late and subject to the penalty. That would appear to be the most consistent approach.

Good luck!

the amount amount was actually decreased due to losses in the account, still a penalty?

[ETA Consulting LLC]

No, you have a different issue. There was a distribution made that fell outside the terms of the plan. The excess amount would have to be collected from the Participant and put back in the plan. You didn't fail to timely correct; you overdistributed.