Sign Up

Why sign in to the Community?

  • Submit a question
  • Check your notifications
or and start working on your taxes
cancel
Showing results for 
Search instead for 
Did you mean: 
rgthelen
New Member

When will the IRS instructions to disaster distributions (for emergency withdrawals of 401ks) be available?

I withdrew some money from my 401K under the Covid-19 emergency/hardship clause, how do I spread my taxable income over 3 years?
3 Replies
DanaB27
Expert Alumni

When will the IRS instructions to disaster distributions (for emergency withdrawals of 401ks) be available?

Form 8915-E, that reports the Coronavirus-related relief measures for retirement plan distributions, is not yet finalized by the IRS. TurboTax will update this section after the IRS releases the final version of Form 8915-E and then you can finish your distribution information.

 

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

 

 

Please follow these steps to enter your 1099-R:

  1. Login to your TurboTax Account 
  2. Click on the Search box on the top and type “1099-R”
  3. Click on “Jump to 1099-R” and you should see the “Your 1099-R Entries” screen
  4. Click "edit" and continue until "Tell us if any of these uncommon situations apply" screen
  5. Select "I took out this money because of a qualified disaster (includes COVID-19)" (TurboTax will walk you through questions once this section is ready)

 

 

Those who qualify as individuals directly impacted by the pandemic will be able to withdraw up to $100k from their retirement accounts without facing the 10% early withdrawal penalty.

 

You qualify if:

  • You, your spouse, or your dependent are diagnosed with COVID-19
  • You experience adverse financial consequences as a result of being quarantined, furloughed, or laid off or having work hours reduced because of COVID-19
  • You’re unable to work due to child care closure or hour reduction because of Covid-19
  • You experience adverse financial consequences as a result of closing or reducing hours of a business that you own or operate due to SARS-CoV-2 or COVID-19.

 

You can choose to have the distribution taxed over 2020, 2021, and 2022 instead of only in 2020. You’ll have three years to pay back the funds you withdrew, without the amount impacting that year’s cap on contributions. If you pay back the amount within that time, you’ll be able to claim a refund on those taxes paid when you file an amended tax return. Please see IRS Coronavirus-related relief for retirement plans and IRAs for more details.

 

 

 

 

 

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
sexytrucker74421
New Member

When will the IRS instructions to disaster distributions (for emergency withdrawals of 401ks) be available?

please let me know when i can finish my taxes

JotikaT2
Expert Alumni

When will the IRS instructions to disaster distributions (for emergency withdrawals of 401ks) be available?

Please see the link below for more information on the release date for this form. 

 

Once it is released, you will be able to proceed to update your program and file your returns.

 

1099-R release updates

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
Dynamic AdsDynamic Ads
Privacy Settings
v