Should I expect to receive 2 separate 1099-R forms...
Sign Up

Why sign in to the Community?

  • Submit a question
  • Check your notifications
or and start working on your taxes
Announcements
TurboTax has you covered during Covid. Get the latest stimulus info here.
cancel
Showing results for 
Search instead for 
Did you mean: 
daniellemajor82
New Member

Should I expect to receive 2 separate 1099-R forms if I had an early 401k withdrawal AND a simultaneous 401k loan offset distribution?

I was laid-off and cashed out my 401k.  My previous  loan balance was offset and I received a check for the remainder, less federal and state taxes. Today I received a form 1099-R for only the loan offset amount, which indicates no taxes were taken out.  I have not received a 1099-R for the full (taxed) withdrawal amount.  Should I expect additional forms to arrive or does this sound like an error?  Thank you for any assistance!
2 Replies
KrisD15
Expert Alumni

Should I expect to receive 2 separate 1099-R forms if I had an early 401k withdrawal AND a simultaneous 401k loan offset distribution?

Yes, you should receive a second 1099R.You will need to report both.

 

It sounds like you had taken a loan out against your 401k. When you later closed the 401k account, you should have had the option of repaying the loan, or having the account reduced by the outstanding loan amount. It sounds like you took the option of having the loan offset and receive a lesser amount.

 

The 10% penalty tax on that final withdrawal COULD be waived because of the CARES Act (if applicable). The TurboTax software will ask you about that.  Below is a link to a TurboTax article with more information: 

 

2020 Stimulus: Tax Relief for This Year's Taxes 

 

 

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
dmertz
Level 15

Should I expect to receive 2 separate 1099-R forms if I had an early 401k withdrawal AND a simultaneous 401k loan offset distribution?

Two different Forms 1099-R are required because the coding in box 7 is different for these two distributions.  The Form 1099-R for the offset distribution will include code M to indicate that you generally have until the due date of your tax return, including extensions, to come up with the money to roll over some or all of the offset distribution.  However, if you qualify for these to be treated as coronavirus-related distributions and report them as such, you have 3 years to repay the distributions.

Dynamic AdsDynamic Ads
v
Privacy Settings