I had to cash out 3 small IRAs in 2020 because I was laid off too due to the virus. Are there provisions within TurboTax software? Has the software been updated already?

[Critter-3]

After you enter all 3 1099-R forms complete all the following screens for the reporting options. 

[lexikenzi8]

A friend mentioned I can spread my tax out over 3 years? Is this true?

Sorry the number of words allowed to ask a question was short. 

[Critter-3]

YES ... this info is presented in the following screens after entering the 1099-R ... go slow and read the screens.

[AmyC]

Yes. Form 8915-E has you spread it over 3 years. In addition, you have those 3 years to repay the money. So you may be able to repay some of it in the next 2 years and not have to pay the full tax on your distribution. To enter:

1. Return to the 1099-R, edit/update
2. Box 1 gross distribution
3. Box 2 taxable amount, enter the full amount
4. Box 7, code 1
5. taxes withheld
6. continue
7. About the Money... continue
8. Answer IRA, Safety Officer, continue
9. Select your state, continue
10. Where Is this Distribution from? Neither of the above, continue
11. What did you do? Something else, continue
12. Periodic payments? No, continue
13. Was this COVID? Yes, COVID, continue
14. How much? Enter all or portion, continue
15. Receive before Dec 30? Yes
16. Did you or dependents test positive? answer
17. Did you have reduction in income or other on the list? answer, continue
18. Did you repay any? answer, continue

@lexikenzi8

[lexikenzi8]

Something else the instructions aren't clear for me, on. I'm 67 not under 59 1/2 so there isn't a penalty but I still need to spread the tax out over 3 years. Will the software prompt me to fill out the 8915-E form? 

[Critter-3]

Yes it will ... read all the screens in the 1099-R entry section. 

[lexikenzi8]

Well it did not prompt me while I was focused specifically on that 1099-R. Can you display a screen shot and show me?

Also TT refers to more instructions that I should come back to later. Later meaning I assume before I finalize my taxes and am ready to submit, but that isn't clear either. I guess we have 3 weeks and TT is furiously working on those instructions? AB

[ColeenD3]

Here is the screenshot for the COVID distribution.