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Level 1
posted Apr 19, 2022 1:13:24 AM

If i withdrew money from my 401k for corona virus distribution in 2020 does that disqualify me to claim retirement savings contribution credit on 2021 taxes?

Im paying the taxes over 3 years if that makes a difference to the answer.

0 7 926
7 Replies
Expert Alumni
Apr 19, 2022 3:09:39 AM

Yes. Line 4 of Form 8880 says this:

 

Certain distributions received after 2018 and before the due date (including extensions) of your 2021 tax return (see instructions). If married filing jointly, include both spouses’ amounts in both columns

 

See Form 8880 with instructions.

Level 15
Apr 19, 2022 5:35:22 AM

@luscious80 

It depends on your final AGI.

your covid-19 distribution reported will increase your AGI.

That can disqualify you immediately.

Level 1
Apr 19, 2022 9:08:45 AM

On TT it asks if I received any disbursement after 2018. It also says they are only talking about early withdraw before due date on 2021 taxes. So do I answer yes or no if I took out money in 2020 for coronavirus disaster only?

Expert Alumni
Apr 19, 2022 9:22:10 AM

You want to answer yes that you took a distribution so that you can mark your 1/3 for this year. When it asks the second time, mark no since you have already answered the question. You will get stuck going around forever otherwise.

Level 1
Apr 19, 2022 9:26:48 AM

That's why I'm confused I already input all the info for the 1/3  of my withdraw but later it asks this question. So is this question pertaining to the coronavirus withdraw or are they referring to any other withdraw besides the 2020 coronavirus withdraw?

Expert Alumni
Apr 19, 2022 9:48:36 AM

Others, once you have marked your 1/3, answer no to the remaining questions.

Level 1
Apr 19, 2022 3:24:28 PM

Thank you!