401k rolled over to a Traditional IRA after job loss to Covid-19

[redhead-88]

So I lost my job like many other people last year because of Covid-19. I had a 401k with the company and received a 1099-R for my taxes this year. It has been rolled over to a Traditional IRA, and as I am trying to complete my taxes it looks as though the 1099-R being treated as income?

Boxes:

2a) $0.00

2b) Total distribution is checked☑️

7) Distribution code "G" for rollover

and the last box that has something is the state box 15) WA

I filled out the part where it asks if the withdrawal was due to covid-19 because it was... and it says I won't have to pay the additional tax on the early withdrawal. So that's good I guess. Then it asks if I repay any of this distribution? I wasn't sure what to put for that so I said I repaid none of the distribution. Is that wrong for this situation? 

Also, am I allowed to put the new Traditional IRA as a contribution?

Thanks in advance for helping me answer these questions!

[dmertz]

A code-G distribution is not a distribution made due to COVID-19 (even though you were required to close the 401(k) account due to leaving this employer).  It's an ordinary direct rollover.

[redhead-88]

Okay, thank you for clarifying that.

I have one more question. Can you use the money you contributed to your 401k (which was rolled over to a Traditional IRA) in 2020 as a deduction?

Thank you!

[dmertz]

A rollover is not deductible.  A nontaxable rollover is already excluded from taxable income.  It is not a regular traditional IRA contribution.

[Opus 17]

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@redhead-88 wrote:

Okay, thank you for clarifying that.

I have one more question. Can you use the money you contributed to your 401k (which was rolled over to a Traditional IRA) in 2020 as a deduction?

Thank you!

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Money contributed to a qualified workplace plan via payroll deduction is already covered on your W-2--it is listed in box 12 and the wages have already been removed from your W-2 box 1 taxable wages.  You can't take an extra deduction, it has already been subtracted from your taxable wages.  Do not enter the contributions later.  IRAs and 401(k) are handled completely differently on your tax return even though they have similar purposes.

You always are allowed to roll a workplace plan over into a private IRA after you leave the employment, you don't have to invoke special COVID rules.