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Cares Act & Hardship Withdrawl

Forum|Forum|4 years ago
February 13, 2022
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If memory serves me correct, Turbo Tax had a built in flow for hardships withdrawals from your retirement for Covid-19. I also seem to recall it said it would let you spread that tax penalty over 3 years. This year has nothing about the Cares Act or that carryover at all. What gives?

Best answer by DavidD66

If had a coronavirus related withdrawal from a retirement plan, and you elected to spread the income and the tax over three years, that election will automatically roll over to 2021. This will require Form 8915-F, which is not yet available. Once the form is available, TurboTax will be updated to include it and it will calculate the tax on your 2020 coronavirus withdrawal for 2021.

fanfare

Employee

If you did not take a COVID-related early withdrawal in 2020, this does not concern you.

C

covertrainAuthor

I did. I took an early withdrawal. Paid taxes on that withdrawal last year and it I seem to recall it saying that you would split the tax owed over three years. However, I don't see where that is continued on this years return. Turbo tax doesn't continue where it left off last year.

D

DavidD66Answer

If had a coronavirus related withdrawal from a retirement plan, and you elected to spread the income and the tax over three years, that election will automatically roll over to 2021. This will require Form 8915-F, which is not yet available. Once the form is available, TurboTax will be updated to include it and it will calculate the tax on your 2020 coronavirus withdrawal for 2021.

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