I know about the rule where you can spread out over three years a COVID withdrawal but what are the mechanics when taxpayer says they want to pay a withdrawal back over three years.. if the entire amount was picked up in income in 2020 does the return get amended for the amount repaid in 2021, 2022, etc.. I did try and research this but I am still not clear on this.. thank you.
Spreading the income over three years is a Disaster provision unless you elect to report it all in the year of distribution.
Repayment is a 3-year concept, clock started on the date of distribution.
I like articles written for the consumer. Read "What If I Repay the COVID-Related Distribution to My Retirement Plan?" and see if that helps.
Yes, amendments will be needed.
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