The loan you took and the payments you made don't affect your taxes.

Contributions would, but if your employer was taking the payments out of your taxable pay, they'll simply do a reversal. Double check with your company's payroll dept to see how they'll handle the overpayments they took.

Aren't the payments that exceeded my loan put into my 401k account as a contribution? This is what my employer said and told me they have to figure out the gain or loss on those contributions before they refund me the money. Just a bit confused. Thanks for your help.

I would think if you still contribute to a 401K through your employer, even though you took out part of the money as a "loan", any deduction, per your loan contract, would be applied to the loan if it's to be repaid, and any remaining part of the deduction would be your monthly contribution to your 401K, which you would normally contribute to whether you had a loan or not. If the amount taken out is more than the loan payment 'and' your contribution, then it would be an overpayment of your loan and you should be able to request a refund of the difference. Your employer should handle the overpayment as just that because if you choose to contribute extra money to your 401K, you will be limited. If it is a loan "overpayment", it is not up to your employer to assume putting into your 401K as a contribution is OK. Be sure to follow up with any error/corrections so it doesn't happen again. This should not effect your taxes already filed for year 2009. But if in doubt, consult a tax advisor and you can always file an amendment.

Thank you for your help and speedy response!

You said: "Aren't the payments that exceeded my loan put into my 401k account as a contribution?"

No loan repayments should have been treated that way on your paycheck.