I took a $68,000 contribution out of a qualified plan due to COVID 19, I returned the funds within the year, I thought I had three years to do that. Why is turbo tax still applying a taxable to 1/3 of it?
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@dilorenv wrote:
I took a $68,000 contribution out of a qualified plan due to COVID 19, I returned the funds within the year, I thought I had three years to do that. Why is turbo tax still applying a taxable to 1/3 of it?
Be sure to answer the COVID questions and when it asks if funds were returned in 2020 - enter the total amount. If not returned until 2021 then 1/3 will be taxable in 2020.
If you repaid all of the funds before December 31, 2020, you will have to enter this information on the page titled Did you repay any of this distribution? I have attached a screenshot below for additional guidance. This screen flows your entry of the 1099-MISC.
To get back to your 1099-R input, please follow the instruction below:
On the mock-up return I completed, none of the amount on the 1099-R that was taxable and a Covid-19 distribution (which I later marked as repaid in full) was taxable.
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