COVID relief 401k early withdrawal

Forum|Forum|4 years ago
February 9, 2022
27 replies
165 views

In December 2020, I withdrew money from my 401 due to the pandemic. In preparing my taxes in TurboTax, I discovered that the withdrawal was underrated and that I owed. I was given the option of paying the undertaxed amount in three yearly installments (so the first was paid last year in 2021 for 2020- automatically deducted from my refund). My question is this: now that I'm preparing my 2021 taxes, knowing that I still have two thirds of that amount to pay back, how do I access that in TurboTax? Nothing is showing up for repayment. Should I be receiving a new 1099-r? Should I re-enter 2020's 1099-r this year and next year until it is paid? Very confused, and any info will be greatly appreciated.

Best answer by MinhT1

You will not get another form 1099-R this year.

You will report the second taxable portion of your 2020 coronavirus distribution in the Retirement section under Wages and Income of TurboTax.

However, this section is not yet ready as the IRS has not yet issued instructions for form 8915-F and you'll need to revisit this section later.

Please read this TurboTax Help topic on form 8915-F.

At this time, we do not know when the IRS will finalize form 8915-F as it is still in draft form as of February 2, 2022.

MinhT1Answer

Level 15

You will not get another form 1099-R this year.

You will report the second taxable portion of your 2020 coronavirus distribution in the Retirement section under Wages and Income of TurboTax.

However, this section is not yet ready as the IRS has not yet issued instructions for form 8915-F and you'll need to revisit this section later.

Please read this TurboTax Help topic on form 8915-F.

At this time, we do not know when the IRS will finalize form 8915-F as it is still in draft form as of February 2, 2022.

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jh2k

Level 2

On TurboTax 2021, I wanted to work on the second of a three-year distribution penalty exemption due to COVID-19, but as of today, update is still not available. Any news? Thanks.

DianeW777

Alumni - Intuit

Great news! The IRS created new Form 8915-F to replace Form 8915-E. This form will be used for anyone who chose to take a distribution from their retirement and spread the taxable amount over three years.

It was recently (approximately 10 days) taken out of draft and finalized. TurboTax has an available date of March 24, 2022. Continue to check the availability date by using the link provided.

When entering your 1099-R in TurboTax CD/Download, you’ll be asked Was this withdraw due to Covid-19? On the next screen, it should ask you Did you test positive for the coronavirus in 2020? However, some users are reporting they aren’t being asked that second question.

We’re working to resolve this issue. If you’d like to receive progress status updates, sign up here.

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kjblack

Level 2

I came to the page “Have you ever taken a disaster distribution before 2021”. Clicked Yes and continue. Then I brings me to a page that is already filled out with my 1/3 payment, but when I click continue nothing happens to my refund and doesn’t show up in the withdrawal section. Can someone walk me through how this is supposed to work?

Shortick1

Level 2

Hi KJ,

I did not have that happen on mine. It asked me to add information from my 2020 form 8915-E from specific lines vs pre filled in. You might want to call TurboTax for help- they were really good and helpful with my issue as described above and it only took 5 minutes for a call back. Good luck!