IRA withdrawals - can the amount be spread out in 3 years just like 401K distributions?

[Cookie2021]

Can IRA withdrawals be spread out in 3 years just like 401K distributions?

I have a client who withdrew $45K from his IRA.  When I select the COVID-19 option, it calculates $13K to be reported in 2020.  I thought the program would calculate $15K for 2020, 2021 and 2022.  Are IRA and 401K distributions treated differently for the 3 year spread?

[TaxGuyBill · Accepted solution]

Yes, if the person is a qualifying person, IRAs can be spread out over 3 years for a Covid distribution.

Is there any Basis in the IRA (also look at Form 8606)?  Does box 2 show the full $45,000 as taxable? Look through Form 8915-E to see what is happening.

[abctax55]

Did your client also make an IRA contribution for 2020?

[Cookie2021]

yes, he contributed $6k the his IRA account in 2020

[qbteachmt]

You should read the Form 8915-E instructions so that you know who is eligible, which types of accounts qualify, etc:

https://www.irs.gov/pub/irs-pdf/i8915e.pdf