Over contributing to 401K

[Ms.PacMan]

Does anyone know what happens when you contribute over the pre-tax limit of $17,000? With all the OT this year I'm going to go over the limit.

Do they just designate the extra money as post-tax or stop your contributions?

 

[raceanoncr]

They just stop taking out at your max.

Always did with me.

 

[UpstateNYUPSer(Ret)]

They stop at your max ($17K<50, $22.5K>=50).

 

[packageguy]

They stop at the max... they done it to me ....

 

[Ms.PacMan]

Thanks for the answers!

 

[ajblakejr]

Thanks for the answers!

Congrads!! I share the same goal of topping out that 401K!!

 

[UpstateNYUPSer(Ret)]

Not sure why you folks contribute to these 401k plans at all?

You mean other than the tax incentives and compound interest earned?

 

[ajblakejr]

You mean other than the tax incentives and compound interest earned?

And dollar cost averaging?

Sweetie, brashman, I can call you sweetie, 25% of my income since 1997, I am sitting very well.

 

[brownmonster]

I wish Over would contribute to my 401K.

 

[Catatonic]

Does anyone know what happens when you contribute over the pre-tax limit of $17,000? With all the OT this year I'm going to go over the limit.

Do they just designate the extra money as post-tax or stop your contributions?

You also may get part of your contributions back around March 2013.
I have maxed out for probably 15 years and in that period, I have had somewhere around $3000 - $3800 because not enough people had contributed to their 401k within UPS. It has not happened in the last 2 years so maybe more UPSers are having more taken out.
You can go ahead and file your taxes if you like and treat it as income on the following year's Income Tax forms - sort of like State Tax refunds.

 

[Ms.PacMan]

Next week should push me over so we'll see what happens.

If they throw the money into after-tax I'm going to roll it over into my Roth IRA. Our plan allows in-service withdrawals of after-tax funds. The plan also allows 5% after-tax contributions which can be rolled over into an IRA to increase a person's tax-deferred investments. After reading about this last year I was tempted to intentionally contribute after-tax monies but was worried it will be a huge PITA. This may force me to give it a try.

Anyone interested can read about it here and here.

 

[Ms.PacMan]

Payroll cut me off at $17K.

 

[Kae3106]

The system is programmed to stop at the maximums. If someone keys a manual entry in the Payroll system after that and you go over the maximum allowed amount, it will hit a report and we will refund you and adjust the annual totals accordingly.