401-K early withdrawal CARES act

[valemoto7]

I received form 1099-R as I early withdrew money from my 401-K due to COVID 19. However, the system is currently charging me the 10% early withdrawal penalty when I input the form. Why am I being penalized if this penalty is not supposed to be applicable under the CARES act? 

[LinaJ2020]

The issue has been submitted and is currently under investigation.  Please click on the following link and sign up for an email notification when it's fixed.  

Form 8915-E

Thank You for your patience

If you are under age 59 1/2, the distribution from the 401k is considered as an early withdrawal.  Generally, you will pay both regular tax and an additional 10% penalty of your entire distribution unless you met certain criteria.  Due to the CARES Act, if your 401k distribution is related the Covid-19, you will not be liable for this additional penalty.  You will still pay the normal taxes like your wages and income.  For more information from the IRS, click here: Covid Relief.  If your distribution is not related to the Covid, you will need to pay the penalty.