Excess Contributions

Excess Contributions are.

contributions to cash or deferred arrangements for highly compensated employees in excess of the amount allowed under nondiscrimination rules. The excess contribution must be recharacterized as an employee contribution or distributed (in addition to any income earned) to the highly compensated employee. If the excess contribution is not recharacterized or distributed within 2xh months after the plan-year end, it is subject to a 10% tax penalty. Former IRC (check if this IRC provision is current here) §4979-.