When will Form 8915-E be available? TurboTax indicates "IRS instructions related to disaster distributions weren't ready in time for this release." It's been weeks now.

[dmertz]

igould, you mentioned paying back 45%.  If you pay back 45% before the due date of your 2020 tax return, no part of the CRD is taxable on your 2020 tax return.  The remaining 55% of the distribution is taxable on your 2021 and 2022 tax returns  (21 2/3% on your 2021 tax return and 33 1/3% on your 2022 tax return).

Examine Form 8915-E to see the amount that is taxable on your 2020 tax return and look at Form 1040 lines 4b and 5b to see that the taxable amount(s) determined on Form 8915-E is propagating to Form 1040.

The only way that you could split the remaining 55% over 3 years would be to treat only 55% of the distribution as a CRD.  However, doing that would require that the 45% was rolled over within 60 days of the distribution (or, if later, by July 15 if the distribution occurred after January or by August 31 if the amount repaid would have been an RMD were it not for the CARES ACT) and would not by cause a violation of the one-rollover-per-12-months limitation on IRA rollovers.

[igould]

On Form 1040 line 4b - its zero.  Seems like it should be 1/3 of my net distribution 18.3k (100k - 45k = 55k / 3 = 18.3k).  And sorry for not following the last paragraph.  CARES states if I withdrew 100k prior to 12/31/20 for Covid, then I can pay back an amount prior to filing (April filing) and then the net amount will be taxable (55k).  And I can choose to pay the tax all in the 2020 tax return OR spread it over 3 years. So therefore the tax should be on the 18.3k electing the 1/3 method.  Isn't that correct?  and should TT calculate it like that? Sorry for not getting this and all the back and forth.

[macuser_22]

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@igould wrote:

On Form 1040 line 4b - its zero.  Seems like it should be 1/3 of my net distribution 18.3k (100k - 45k = 55k / 3 = 18.3k).  And sorry for not following the last paragraph.  CARES states if I withdrew 100k prior to 12/31/20 for Covid, then I can pay back an amount prior to filing (April filing) and then the net amount will be taxable (55k).  And I can choose to pay the tax all in the 2020 tax return OR spread it over 3 years. So therefore the tax should be on the 18.3k electing the 1/3 method.  Isn't that correct?  and should TT calculate it like that? Sorry for not getting this and all the back and forth.

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Dmertz explained it above.

No the "net" amount $55K is not what is taxable. It is the gross (1099-R box 1) amount $100k.  $33K taxable in 2020, $33K taxable in 2021 and $33Ktaxable in 2022..

But what you paid back in 2020 is not taxable for 2020 because it was paid back.   So it subtracts from the 2020 $33K taxable amount.

[igould]

OK so is this correct ? since my payment of the distribution of 45k is more than the 2020 33k taxable 1/3, there is no taxable amount left over?

[macuser_22]

For 2020 that is correct.   The rest will be taxable in 2021 and 2022.

[igould]

great thanks for all the info

[benihana740]

I would make sure you are 100% before submitting. I have gotten the same error since the form was released using online premier, and I didn’t pay any of it back. $0 keeps showing up as the amount of Covid distribution, when it should be closer to $20,000.

It’s a programming error that’s been pretty well documented on these threads. Needs addressed asap. 

@igould 

[igould]

Hi I was thinking further on this:

1) wouldn't the logical calculation to have set up would have the repayment, especially in the first year, "restate" the overall early distribution and then the net to be taxable over 3 years (so in my case 100k-45k repay = 55k remaining / 3 = 18.3k taxable each year) vs 100k / 3 = 33k - 2021 = 33k - 45k = -12k (no tax); Based on the way you described, years 2 and 3 will each have a taxable amount of 33k (assumes I don't pay back).  

2) Also will the amount over the 1/3 payment I made in 2020, 12k be offset against 2021 33k?

[macuser_22]

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@igould wrote:

Hi I was thinking further on this:

1) wouldn't the logical calculation to have set up would have the repayment, especially in the first year, "restate" the overall early distribution and then the net to be taxable over 3 years (so in my case 100k-45k repay = 55k remaining / 3 = 18.3k taxable each year) vs 100k / 3 = 33k - 2021 = 33k - 45k = -12k (no tax); Based on the way you described, years 2 and 3 will each have a taxable amount of 33k (assumes I don't pay back).  

2) Also will the amount over the 1/3 payment I made in 2020, 12k be offset against 2021 33k?

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#1)    1/3 pf $100K each year if you do not pay anything back. in 2020.

if you paid $55K back in 2020 then that leaves $45K remaining to be paid back in 2021 & 2022.

What makes  more sense is irrelevant - Congress wrote the law this way.

#2  The CARES act says:  "any amount required to be included in gross income for such taxable year shall be so included ratably over the 3-taxable-year period beginning with such taxable year."

The IRS has interpreted that to mean "split into 3 equal parts" i.e. $33.33K each of three years, but you can pay back any of the original $100K at anytime you wish.

I believe that makes $33.3K taxable in 2021 (unless paid back) and what remains taxable in 2022 if not paid back.

[igould]

Ha definitely on the Congress and irrelevant part - thanks for your help

[ene777]

I am having the same issue, and customer support doesn't know. Did you get anywhere?

[igould]

Could you stay what your issue is?

[benihana740]

If you are refereing to Turbo Tax programming errors and glitches when opting to make payments over a three-year period on Covid Roth IRA distributions made during year 2020, no I have not. 

Waiting to see if they fix. If not, I will start fresh using another company. 

@ene777 

[macuser_22]

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@benihana740 wrote:

If you are refereing to Turbo Tax programming errors and glitches when opting to make payments over a three-year period on Covid Roth IRA distributions made during year 2020, no I have not. 

Waiting to see if they fix. If not, I will start fresh using another company. 

@ene777 

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What problem are you having?   All versions of TurboTax presently support that after the Feb 26 update.

[Holypinta]

Anyone know when they are going to fix this issue? Would be nice to be able to file before the next stimulus payment