My understanding is that Turbox Tax just updated the 8915-E form and instructions. I have installed the latest update this morning but I still see myself paying the 10% early withdrawal penalty for my 401-k withdrawal in 2020. I thought IRS waived the early withdrawal penalty if I was being laid off. Please advise, thank you.
Yes, those who qualify as individuals directly impacted by the pandemic will be able to withdraw up to $100k from their retirement accounts without facing the 10% early withdrawal penalty.
You qualify if:
Please follow these instructions:
You can choose to have the distribution taxed over 2020, 2021, and 2022 instead of only in 2020. You’ll have three years to pay back the funds you withdrew, without the amount impacting that year’s cap on contributions. If you pay back the amount within that time, you’ll be able to claim a refund on those taxes paid when you file an amended tax return. Please see IRS Coronavirus-related relief for retirement plans and IRAs for more details.
Thank you for your response. I just don't see the question that you were referring to. I tried to delete my 1099-R and redo it again and TurboTax still subject me to the the 10% early withdrawal penalty. Please advise, thank you.
If you are using TurboTax Online then please follow these instructions: