Designating excess deferrals in multiple plans (402g limit)

[roy819]

An individual worked for 2 unrelated employers in 2025 and deferred into separate 401k plans. They deferred $15,000 into Plan A and $15,000 into Plan B. They are not catch-up eligible and they need a 402g refund of $6,500.

Based on what I am seeing in the regs, the individual ultimately determines which plan holds the excess. If you go by the last-in, first-out method - Plan B would issue the refund. But, Plan B has a very generous match and the individual would have to forfeit some of his match if the refund comes from Plan B.

Can the individual choose Plan A as holding the excess? Or, can they designate a portion of the excess from Plan A and a portion from Plan B? For example, can they request $3,000 to be refunded from Plan A and $3,500 refunded from Plan B?

 

 

[Bri]

They ought to be able to, but they might need to convince either sponsor the excess has really occurred.  (Otherwise this is a request for a random-ish looking withdrawal absent the knowledge of the other plan.)

 

[Paul I]

Your W2 from each firm should have the amount of deferrals you made while employed by each firm (Box 12).  That should be sufficient proof for all parties.

[CuseFan]

Yes, and then the person can request however much of their excess from each of the plans as they choose. This is a tax compliance issue for the person, not a qualification compliance issue for either plan.