Why isn't turbo tax asking me abou form 8915-E for my covid 401K distrubtion?
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Withdrawals from a IRA because you were affected by COVID-19 are not subject to the 10% early withdrawal penalty. Additionally, the tax on the distribution can be paid over a three year period. 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.
In order to waive the penalty and elect to the option to pay the tax over three years, you will have to complete Form 8915-E, which has not been released by the IRS yet. If you would like to review a draft copy of the form, click the following link: Draft, Form 8915-E. Once the IRS finalizes and releases the form, TurboTax will make it available. Until then, you'll have to wait to finalize your and file your tax returns.
The form has already been released and in have updated turbo tax but turbo tax is still not asking me if I withdrew due to COVID and I do not see where I can split the withdrawal over 3 years.
Designating Form 8915-E details, that the withdrawal was for COVID-19 and designating the tax to be paid over 3 years is done in the IRA, 401(k), Pension Plan Withdrawals (1099-R) section after your Form 1099-R details have been entered.
To see this in TurboTax, return to the program and search for 1099-R. Select the Jump to link in the search results.
If your questions are not there, and your program is fully updated, then delete and re-enter Form 1099-R.
For more information, see:
What is Form 8915-E Qualified 2020 Disaster Retirement Plan Distributions and Repayments?
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