topic 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden in Retirement tax questions

2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

Vickmorn — Wed, 09 Dec 2020 22:26:53 GMT

Will the 2020 TurboTax Software also have the option to spread the income taxes for an eligible 401K withdrawal over 3 years as allowed by the CARES Act guidelines?

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

DoninGA — Wed, 09 Dec 2020 22:35:05 GMT

Yes. The TurboTax software will include all the instructions and forms related to the CARES act for a retirement plan withdrawal after the IRS finalizes and approves all the necessary forms and instructions.

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

Opus 17 — Wed, 09 Dec 2020 22:35:39 GMT

Yes. Turbotax will have every form and instruction that is allowed and required by the IRS. However, that section of the program isn't ready yet because the IRS isn't ready either.

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

tax novice — Thu, 10 Dec 2020 22:53:40 GMT

I converted an IRA to Roth and now i dont have the funds to pay the tax bill in April, will I be able to claim hardship withdrawal and spread the tax bill over the next three years?

thanks

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

the-blessing — Thu, 14 Jan 2021 14:20:44 GMT

When will that section of the program be ready?

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

DoninGA — Thu, 14 Jan 2021 14:23:30 GMT

@the-blessing wrote:

When will that section of the program be ready?

The IRS has not finalized the Form 8915-E for CARES act withdrawals from retirement plans. The IRS has not communicated when the form will be available for including in the 2020 federal tax return. Once the form and instructions have been finalized it will be included in the TurboTax program.

Estimates are the Form 8915-E will be available sometime in February.

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

Deb Kelly — Mon, 25 Jan 2021 15:54:28 GMT

Thank you everybody !

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

Erich1981 — Thu, 28 Jan 2021 00:03:13 GMT

I tried last night and didn’t see the option to add money for cares act either. Will we receive another form in the mail other than the 1099-R?

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

PattiF — Thu, 28 Jan 2021 01:53:28 GMT

No, you will not receive another form in the mail other than the 1099-R.

The IRS will be releasing Form 8915-E to use with the 1099-R. Here is more information:

CARES Act and 1099-R Withdrawal.

The software has not been updated yet because the form has not been finalized by the IRS. Once the software has been updated, you will be prompted through the form with instructions on how to enter the information.

The IRS has not provided a release date for the form at this time. Use this link IRS Form Availability to watch for when the 8915-E form will be available in the software once the IRS completes it.

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

disgustipated — Fri, 29 Jan 2021 18:14:15 GMT

Any ETA on updates for CARES Act and 401K Withdrawal Tax Burden.

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

CatinaT1 — Fri, 29 Jan 2021 19:54:45 GMT

You will report this on a Form 8915-E. The IRS has not yet finalized the Form 8915-E for retirement plan distributions under the CARES act. So this form cannot be included in the TurboTax program. You will not be able to proceed until the form is available.

The IRS has not communicated when the form will be finalized for inclusion on the 2020 federal tax return.

We estimate it will be sometime in February 2021 before the form is available. You can watch this link for the form availability. Currently, the form is not listed here since there is no estimated date. Once there is, you will find the form listed with the date available.

IRS forms availability table for TurboTax individual (personal) tax products

Additionally, the IRS will not start processing returns until February 12, so waiting for this form is not slowing down the processing of your return.

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

nonotaxman1971 — Sat, 30 Jan 2021 13:49:38 GMT

I asked on line agent and was told the Form 8915-E SHOULD be on line Feb. 18th.

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

u096469 — Sun, 31 Jan 2021 14:10:22 GMT

can you proactively email your subscribers when the form 8915-E is released and I assume the software will automatically update?

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

JamesG1 — Sun, 31 Jan 2021 21:14:20 GMT

At this point and time, the Form 8915-E (Qualified 2020 Disaster Retirement Plan Distributions and Repayments has not been finalized by the IRS.

This TurboTax Help has an email sign-up to notify you when the form is available.

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

DennisG — Mon, 01 Feb 2021 00:24:19 GMT

Will the 8915-E address the TT prompt for separate 1099-R's to cover a partial (2020) RMD with subsequent rollover back into the IRA as per CARES act, QCD contributions, and partial RothIRA conversion? Presently am prompted by TT to prepare several 1099-R's within TT(after entering all of the above manually from the 1099-R sent me by the brokerage)--when only one received from the brokerage(who states they will not be issuing any corrected nor separate 1099-R's to address this).

Thanks very much.

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

SamS1 — Wed, 03 Feb 2021 01:28:53 GMT

You are dealing with a number of items. The only way you will be able to segregate out for each item is to do 3 separate 1099R entries in TurboTax. One for the QCD amount, one for the Cares Act RMD rollover, and one for the Roth IRA conversion. Note the 3 1099Rs should total the box amounts for the 1 1099R received from the broker.

You need to be at over 70 1/2 to take the Qualified Charitable Distribution deduction for your withdrawal. If you are at least 70 1/2, TurboTax will ask whether a portion of your withdrawal was QCD under the Uncommon Situations screen directly after you entered the 1099R information in TurboTax Online.

2. RMDs were waived for 2020. The CARES Act provisions apply to most retirement plans, including traditional IRAs, SEP IRAs, SIMPLE IRAs, 401(k) plans, 403(b) plans, 457(b) plans, profit sharing plans and other defined contribution plans. The RMD suspension does not apply to qualified defined benefit plans.

If you took a RMD but returned it in time then follow these steps when entering your 1099-R:

Please follow these steps to enter your 1099-R and RMD rollover:

Login to your TurboTax Account
Click on the Search box on the top and type “1099-R”
Click on “Jump to 1099-R”
Continue until "How much was a RMD?" and select "none"
You must indicate to TurboTax that none of the distribution was RMD. If you already enter the 1099-R as RMD and changing your answer to the RMD question doesn't work then you have to delete and re-enter the 1099-R form
"Tell us if you moved the money through a rollover or conversion" and select "I rolled over some or all of it to an IRA or other retirement account within the time limits (normally 60 days)
"Continue answering the questions

3. Enter the Roth IRA conversion into TurboTax. Follow the screens the indicate you rolled the amounts into another retirement account.

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

mndstanhope — Fri, 05 Feb 2021 17:48:08 GMT

Is this software available now? (Cares Act & 401K Withdrawal Tax Burden) to be divided into 3 tax years?

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

CatinaT1 — Fri, 05 Feb 2021 17:50:24 GMT

The IRS has not communicated when the form will be finalized for inclusion on the 2020 federal tax return.

IRS forms availability table for TurboTax individual (personal) tax products

Additionally, the IRS will not start processing returns until February 12, so waiting for this form is not slowing down the processing of your return.

Please sign-up here and we will email you once the form is live.

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

frfaris — Tue, 16 Feb 2021 20:28:39 GMT

"The 8915-E Form is projected to be e-fileable starting 02/24/2021"

This is from the TurboTax Help community support questions updated 4 days ago.

Re: 2020 TurboTax Software, CARES Act and 401K Withdrawal Tax Burden

the-blessing — Sat, 20 Feb 2021 11:38:20 GMT

Can I file without it and provide this form in next years return?