Took a Covid qualifying IRA distribution in 2020. Re-contributed most of it in 2020 and prior to 4/15/2021. Can I consider part/all of the re-contribution a deductible IRA contribution for 2020 (subject to income limits, etc). TT is permitting a full deduction IF I consider the fully deductible contribution to have been made in 2021 prior to 4/15/21. TT is limiting the deduction if I consider only part of the IRA contribution as having been made in 2021 (prior to 4/15). The distinction is it measures AGI for the limited deduction scenario with an inclusion of 100% of the covid distribution (even though the option for 1/3 taxation has been elected). What I am not understanding is why it doesn't do the same for the first scenario where it permits a full deduction.
So my first question, is: Must all of the contributions for 2020 be considered partial repayment of the covid distribution or are any eligible to be designated as a deductible contribution? My second question is: Why is TT distinguishing between the two scenarios described above? Why aren't both fully deductible or both partially disallowed? What is the distinction between a portion being contributed in 2020 versus all in 2021? By default are calendar year 2020 contributions considered repayments? Is this a TT thing or an IRS restriction?
Many thanks for anyone's thoughts.
