Form 8915

[cpabsd]

I had several clients that opted to pay all the tax on the retirement plan distributions during 2020.  The Form 8915 E was correctly marked to reflect this and they paid the tax on the full early distribution.  However, when the return is rolled over, the software is defaulting to making the full amount taxable again.  Anyone else experience this?  By deleting the Form 8915 F that is added during the rollover, the issue goes away.  But is this the correct treatment?  The tax was paid on the full amount during 2020 so there should be no carryover amounts.  

[XP4ME]

Just had it happen.  Deleted both 8915-E and 8915-F.

Hopefully that is the right thing?

[Pacun]

The last time I checked, if both forms are present, the correct amount is entered, then when you delete form 8915-E, you are ready to go. You have to make an entry if the person re-invest money up to 1/3 of the amount distributed in 2020.

XP4ME, remember that people has to 1/3 or re-deposit 1/3 to their retirement plan, deleting both is not correct.

 

[XP4ME]

True Pacun, but in the case where I deleted them there is zero chance of re-contribution.  So just delete the 8915-E?

 

[Pacun]

47 minutes ago, XP4ME said:

True Pacun, but in the case where I deleted them there is zero chance of re-contribution.  So just delete the 8915-E?

 

Yes, deleting form 8915-E is not a problem (it is obsolete anyways). Deleting both is not correct.

[XP4ME]

Gotcha

 

[Randall]

I've not had this problem.  I had clients both ways and the rollover seems to be correct.