How is a participant supposed to know how to correctly fill out their

[John A]

The 1099-R instructions seem clear that, in the case of an excess deferral refund of $400 ($500 excess deferral with a $100 loss) paid in January from deferrals in the prior year, the 1099-R would show $400 in boxes 1 and 2a, with a code of P in Box 7. However, the instructions also indicate that the participant must show $500 on their 1040 for the prior year (the year of deferral), and may show the $100 loss on the 1040 for the year the distribution was made. How is a participant supposed to know that their 1040 is supposed to disagree with the amount shown on the 1099-R? Does anyone out there have a standard notice that is sent with the 1099-R to the participant?

[Guest PAUL DUGAN]

See

http://benefitslink.com/boards/index.php?showtopic=3999

I think the same reasoning applies.