Have a Tax Question? Ask a Tax Expert
Thank you for giving me the opportunity to assist you. I will give the best answer that I can with the information provided.
Can you tell me a little more about your "excess contribution" loss? Generally, all funds contributed to a 401K are contributed on a pre-tax basis, and losses are not allowed.
There are penalties for over contribution, and you are required to take the excess amount out of the 401k by the due date of the return.
Did you have after tax contributions to the 401K?
The instructions for deducting your loss on a corrective distribution of elective deferrals can be found on page 10 of the Following publication, in the third column, under "report a loss"...basically you will be entering a negative amount on line 21 of your 1040: