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Coronavirus-Related Distributions

Question:
Favorable tax treatment for up to $100,000 of coronavirus-related distributions. How to file Form 8915-E
Article, Solution:
Retirement

The IRS is giving favorable tax treatment for up to $100,000 of coronavirus-related distributions from eligible retirement plans (certain employer retirement plans, such as section 401(k) and 403(b) plans, and IRAs) to qualified individuals, as well as special rollover rules with for such distributions. It also increases the limit on the amount a qualified individual may borrow from an eligible retirement plan (not including an IRA) and permits a plan sponsor to provide qualified individuals up to an additional year to repay their plan loans. 

If you have a 1099-R reporting a distribution like the above, after you have added your 1099-R form reporting your distribution, on the 1099-R form in your account, click the "Advanced Options" blue link at the bottom of the screen. Then check the box saying that you want to use Form 8915-E (other forms are listed in the checkbox text too) to determine taxable amount - do not double on line 4 (but it also applies to line 5). This will give a taxable amount equal to 1/3 of the distribution because disaster distributions are taxed over a 3 year period unless you elect not to have it taxed over three years. This form may help exempt the 10% early withdrawal penalty, if applicable.

Step 1: https://mytaxes.efile.com/1040/signin

Step 2: Click on Federal Taxes on the left then on Review then on I'd like to see the forms I've filled out or search for a form on the right side.

Step 3: Enter 8915-E and search. 

Step 4: For Form 8915-E click on + Add Form

Step 5: Enter the total amount from your 1099-R forms and that you want to spread over the 3 years on the 8915-E form. Save or Continue

Read more about Form 8915-E

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