How to process, with detail, my COVID ROTH IRA early Distribution to avoid the penalty now that 8915-E has been released?

Forum|Forum|5 years ago
February 26, 2021
8 replies
57 views

I have everything else ready but I need to process my early Roth IRA distribution now that the 8915-E forms have been updated into TurboTax for Home and Business. Would someone mind guiding me on what the detail procedure is within TurboTax to process and to spread out the tax over three years? I have not imported my form from my ROTH IRA Provider yet. I also need to make sure I have accounted for my contributions so that I do not pay tax on that portion as well. Thank you so much for any guidance.

TurboTax Home & Biz Windows

Irene2805

Level 15

Form 8915-E is available in both the CD/Download and online versions of TurboTax. If you are using the online version or after you have updated the CD/Download version be sure to go back through the 1099-R section in the federal return.

First enter (or import) the 1099-R from your Roth IRA provider.

In the screens following the 1099-R entry screen:

You will see a series of questions to see if you are exempt from the additional taxes on early withdrawals [Screenshot #1, below]; and
You will be asked if you want to pay all the tax this year of just 1/3, with the rest reported over the next two years. [Screenshot #2] Check the box if want to pay tax on the entire retirement distribution in 2020. Leave it blank if you want to spread the payment over 3 years.

Screenshot #1

Screenshot #2

Wyatt5Author

Level 3

Thank you for your quick response. I will test this procedure and respond shortly with my results.

Wyatt5Author

Level 3

Follow-up:

I followed the instructions however there is a problem. The full amount distributed should be reported as a covid distribution however it is showing $0 dollars and is not spreading out the amount over three years. Can you tell me where to go into the form and enter the full amount to be entered for the reported amount so it can be distributed properly? Thank you!