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ewinston385
New Member

Which turbo tax program do I use for 401K withdraw?

 
6 Replies
Jimesa
New Member

Which turbo tax program do I use for 401K withdraw?

When you are needing to enter you form 1099-R for your 401k withdrawal, you can begin in any program and the software will let you know that you need to upgrade. Please see the below for more information on where to enter this information:

Where do I enter my 1099-R?
Wgmcdonald
New Member

Which turbo tax program do I use for 401K withdraw?

I just bought a Turbo Tax deluxe and it looks like it does not support my 401k withdrawals. Is this true or should I return it and get the upgrade?.

Wgmcdonald
New Member

Which turbo tax program do I use for 401K withdraw?

I understand that my Turbo Tax will let me know if I need to upgrade. If I open my deluxe version and then find out I need to upgrade do I upgrade through the program or will I need to buy the upgrade Verizon as well?. Also how much is the cost to upgrade?.

DoninGA
Level 15

Which turbo tax program do I use for 401K withdraw?


@Wgmcdonald wrote:

I just bought a Turbo Tax deluxe and it looks like it does not support my 401k withdrawals. Is this true or should I return it and get the upgrade?.


The TurboTax Deluxe edition most certainly does support entry of a Form 1099-R for a withdrawal from a 401(k).

 

To enter, edit or delete a form 1099-R -

  • Click on Federal Taxes (Personal using Home and Business)
  • Click on Wages and Income (Personal Income using Home and Business)
  • Click on I'll choose what I work on (if shown)
  • Scroll down to Retirement Plans and Social Security
  • On IRA, 401(k), Pension Plan Withdrawals (1099-R), click the start or update button

Or enter 1099-r in the Search box located in the upper right of the program screen. Click on Jump to 1099-R

 

 

Strider
New Member

Which turbo tax program do I use for 401K withdraw?

I received my 1099-R that includes my IRA withdrawal (and the withheld tax).  I repaid approximately 50% of the withdrawal 50 days after the withdrawal.   Is the 1099-R suppose to include the amount of the repayment?    Or does the Turbo tax program allow me to reduce the amount of the withdrawal with the amount I paid back wihin the program's work flow?

DawnC
Expert Alumni

Which turbo tax program do I use for 401K withdraw?

No, your 1099-R will not reflect any payments you rolled over.   When you enter the form, it will all show as taxable.   But at the end of that section, you will be allowed to enter the details of your roll-over and TurboTax will adjust the amount of taxable income on your return.   Do not make any changes to your 1099-R; enter it exactly how you see it and go through the follow-up questions slowly.   

 

If you took a distribution from a retirement account due to corona virus related issues, you will be able to waive the penalty and spread the ordinary tax over tax years 2020-2022.  However, the forms have not been finalized by the IRS yet, so TurboTax has not been updated.  Once the forms are final (no date determined by IRS yet), you will see the options to apply the tax relief provisions on Form 8915-E.   The IRS does not start accepting returns until Feb 12th, so check back then to see what the status is.  

 

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:

 

  • You, your spouse, or your dependent are diagnosed with COVID-19
  • You experience adverse financial consequences because of being quarantined, furloughed, or laid off
  • You had work hours reduced to COVID-19
  • You’re unable to work due to childcare closure or hour reduction

 

The distribution would be taxed over 2020, 2021, and 2022. You’ll have that time to pay back the funds you withdrew, without the amount impacting that year’s cap on contributions, and if you pay back the amount within that time, you’ll be able to claim a refund on those taxes.

 

As things change, TurboTax is continually updated and able to handle every situation that arises to ensure your taxes are done right, so you’ll receive your maximum refund.   @Strider

 

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