Form 5329 excess solo 401(k) contributions

Randy Haynes · ‎09-22-2020

I have a self-employed client who has excess solo 401(k) contributions. In ProSeries, on the worksheet for Form 5329, I am entering the excess contribution on line 14B. That brings up an error on line 16A where I am instructed to enter the value of traditional IRA on 12/31. Are they really asking the value of a traditional IRA or the solo 401(k)?

Also, do I still report the excess solo 401(k) contributions on the Keogh, SEO and SIMPLE Contribution Worksheet Part 1 line 6?

Terry53029 · ‎09-22-2020

You just have your client carry over the excess to next year. You do not use form 5329. I believe you can keep the excess this year, and pay an excise tax of 10% on form 5330. Google is your friend.