@igould wrote:
On Form 1040 line 4b - its zero. Seems like it should be 1/3 of my net distribution 18.3k (100k - 45k = 55k / 3 = 18.3k). And sorry for not following the last paragraph. CARES states if I withdrew 100k prior to 12/31/20 for Covid, then I can pay back an amount prior to filing (April filing) and then the net amount will be taxable (55k). And I can choose to pay the tax all in the 2020 tax return OR spread it over 3 years. So therefore the tax should be on the 18.3k electing the 1/3 method. Isn't that correct? and should TT calculate it like that? Sorry for not getting this and all the back and forth.
Dmertz explained it above.
No the "net" amount $55K is not what is taxable. It is the gross (1099-R box 1) amount $100k. $33K taxable in 2020, $33K taxable in 2021 and $33Ktaxable in 2022..
But what you paid back in 2020 is not taxable for 2020 because it was paid back. So it subtracts from the 2020 $33K taxable amount.
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
