State CARES Act conformity regarding COVID 19 distributions

Forum|Forum|5 years ago
February 26, 2021
2 replies
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If so elected by the user for Fed, will Turbo Tax automatically spread the proceeds of a COVID-19 distribution over three years on the individual’s state return for those states that have adopted rolling conformity with the IRC?

TurboTax Deluxe Online

Best answer by JotikaT2

That worked for federal. But it’s not working for state. I’m in ny. I spent hours on the phone yesterday to do what you explained and fixed federal but it won’t allow me to continue bc that error message comes up and says they are still continuing to work on the issue. So I’m assuming it’s a state issue and not turbo tax.

Please see the information in the link below for an update on the state returns.

Form 8915-E state returns update

TheMugzzy

Level 2

I am wondering this also. It is not letting me finish my state return

AmyC

Level 15

Many states begin with the federal AGI. Those would automatically have the correct distribution. For the others, the program will pull it through. You must have filled out the 8915-E and marked that you were affected by COVID.

In addition, you have those same 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.

Federal just finished the form so some states may be still trying to incorporate it into their system.

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Hadar

Level 4

I took the corona-related distribution in Oregon (in 2020 of course) then moved to NY a few weeks later (in 2020 as well).

I intend to pay the entire state tax liability to Oregon, but the 401k distribution is included in my Federal AGI when calculating NY state income tax on my part-year return. Does this mean that I am paying state tax on that distribution in NY, even though I took it (and paying it) in another state?

Is there a way to exclude the corona distribution from that NY state tax calculation? I can't find one.

Any guidance is much appreciated.