dmertz
Level 15

Retirement tax questions

Support for From 8915-E has been released in the online version of TurboTax, but not yet in the CD/download version.

 

I suggest deleting and reentering any Forms 1099-R that you received for a coronavirus-related distribution.

 

In the online version, on the page that asks, "Do any of these situations apply to you?," mark the first box to indicate that you took the money out because of a qualified disaster, then answer the questions related to COVID-19.  This should eliminate any federal early-distribution penalty and allow you to spread this income evenly over three years.

 

I have no way of knowing if this penalty exception will propagate properly to the Wisconsin tax return.  It seems that it should since Wisconsin's early-distribution penalty is calculated as 1/3 of the federal penalty.  1/3 of a $0 federal penalty would be a $0 Wisconsin penalty.