tubotax 401k covid distribution

[breugel]

I cant seem to find where i tell tubotax that my 401k distribution was was for covid under the cares act so I don't get the 10% penalty. Where is it.

breugel

[rjs · Accepted solution]

You need Form 8915-E for that. But the IRS has not yet published Form 8915-E. I'm sure that TurboTax will incorporate the form as quickly as they can after the IRS publishes the form and its instructions.

[PattiF]

Yes, you need to report that you received an exception to the tax penalty to TurboTax. The 1099-R that you received from your 401k distribution should indicate this by having a Code 2 in Box 7. Box 7 can be coded with a 1 which applies the 10% tax, or Code 2 which indicates an exception to the 10% tax so that the withdrawal is not taxed at 10%.   See Page 15 in the following link for information about the codes. 1099-R Forms

{Edited 1/21/2021 11:11 PST}

[breugel]

You’ll receive your IRS Form 1099-R from Fidelity in January 2021. It will include all withdrawals you took from your workplace savings plan, including CARES Act withdrawals which were not directly rolled over into an IRA. You can use the information on this form when you file your taxes. The 1099-R form won’t distinguish the amount of the CARES Act withdrawals versus other withdrawals. You’ll indicate the eligible CARES Act withdrawal amount on IRS Form 8915-E, which you can download from IRS.gov.

[Nini2babies]

Has there been any word or update on when the IRS intends to release that form? (8915-E). 

[PattiF]

There has been no further update on the release of the form. It is expected in February.

[Tom L]

I just got my 1099-R from TD Ameritrade and I took the withdrawal due to covid but on the form in box 7 I have code 1. Do I need to call them and ask for another 1099 form with code 2 or can I use the new form when it comes out in February

Thanks

[JotikaT2]

You should wait until the forms have been released and finalized.

Currently, the forms have not been finalized to waive the 10% early withdrawal penalty implemented with the Cares act.  Once the IRS releases the forms, you will be able to file and have the early withdrawal penalty waived when you file your tax return.

Please see the links below for additional information.

IRS link for Coronavirus relief on retirement plans

Penalty for early retirement withdrawal

[Sorchaofthelake]

Should the 1099-R forms from the 401k provider list the CARES act distributions as a 1 or a 2 in box 7?

[rjs]

@Sorchaofthelake  The distribution code in box 7 would normally be 1 because the 401(k) custodian cannot make the determination that you qualify for an exception.

[M99E]

When will Form 8915E from the IRS be available from the IRS so I can do my taxes for 2020

[DoninGA]

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@M99E wrote:

When will Form 8915E from the IRS be available from the IRS so I can do my taxes for 2020

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This form has not been finalized by the IRS for filing with a 2020 federal tax return.  The IRS has not announced when this form will be available.  Once available it will be included in the TurboTax software.

We estimate the form may be available sometime in February.

[M99E]

Thank u very much Will have to get a corrected 1099R from his employer or pension plan then. Hope this will fix it then.

[KIPTURNQUIST]

THE LACK OF INFORMATION ON THIS FROM TURBOTAX IS UNACCEPTABLE.

[macuser_22]

TurboTax could not give much information  about a form that did not even exist until Feb 11 and then they published the FAQ below.

The TurboTax 8915-E should be available on Feb. 24.

See below for a link to sign up for an email when the form is ready.

This form is necessary to report COVID related distributions from IRA's and other retirement plans to report the distribution, pay it back over 3 years or spread the tax over 3 years.

A COVID-19 related distribution is reported on a new 8915-E form.

See this TurboTax FAQ to sign up for an e-mail when the form is ready.
https://ttlc.intuit.com/community/tax-topics/help/why-am-i-getting-getting-a-10-penalty-on-my-1099-r...