The covid related distribution repayments (or recontributions) do not affect the current year's contribution limits. Repayments are not considered contributions, so you can still contribute the same amount you are otherwise allowed to contribute to your IRA and new 401K in addition to the repayments of 2020 distributions. The 10% you are contributing to your 401K will be tax deductible just like any other 401K salary deferrals and won't be affected by your repayments of the 2020 distribution.
You’ll have that time to pay back the funds you withdrew, without the amount impacting that year’s cap on contributions, and if you pay back the amount to any qualified plan within that time, you’ll be able to claim a refund on those taxes.
The CARES Act also provides that any part of a COVID-19-related distribution is eligible for tax-free rollover treatment to be recontributed to a qualified plan within three years of receipt and therefore excluded from income. Any amount recontributed is treated as a direct tax-free rollover where eligible or as an indirect rollover with the typical 60-day requirement adjusted to three years. A recontribution is not subject to the one-rollover-per-year limitation.
You can contribute to a traditional or Roth IRA even if you participate in another retirement plan through your employer or business. However, you may not be able to deduct all of your traditional IRA contributions if you or your spouse participates in another retirement plan at work. Roth IRA contributions might be limited if your income exceeds a certain level.
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