repayment of coronavirus distribution to IRA if distribution came from 401k
I took a corona virus related distribution from my 401k plan last year.
I would like to repay a portion of it – Can I do so into my IRA account or must it go back to my 401k plan?
Thx
Permalink Submitted by Alan - IRA critic on Tue, 2021-02-02 17:50
You can repay into any eligible retirement plan other than a Roth IRA. When you repay to your TIRA account be sure to tell the custodian that the contribution is a CRD repayment, not an ordinary rollover. The custodian will then code the 5498 as a repayment in Boxes 14a and 14b (code DD), rather than as a rollover. The IRS can then match the 5498 up with your Form 8915 E and they will conform.Your 2020 8915 E will report the CRD and you must elect to report the CRD income all in 2020 or 1/3 each for 2020-2022. You will also report the repayments on this form if made by the due date for your return (including extensions). The portion you repay by that date will be applied first to the taxable income reportable in 2020.