Form 8915-E is finalized. You can use that form to spread out the income over 3 years, if you were affected by COVID.
To be affected by COVID, you or someone in your house were diagnosed with COVID, you experienced adverse financials consequences as a result of COVID due to ability work, reduced hours and more. See Coronavirus-related relief for retirement plans and IRAs. Most people were affected by COVID.
The IRS is updating form 5329’s instructions to make it clear that COVID related exceptions cannot use 5329 and should use the new 8915-E.
- Go back through the program, edit the 1099-R, and mark that you were affected by COVID.
- You may need to return to the Form 5329 and delete it. See How to Delete
In addition, you have those 3 years to repay the money. So you may be able to repay some of it in the next 2 years and not have to pay the full tax on your distribution.
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