In 2024, filing this form for your Covid distributions for 2020 is no longer an option.
Non-IRA Distributions
You should complete these lines if you received a pension or non-IRA distribution.
Income for prior years from non-IRA retirement plan qualified disaster distributions - from 2022 Form 8915-F Line 11- Report one third of the qualifying distribution you made during 2022 or the full distribution if you elected not to distribute it over three years.
Income for prior years from non-IRA retirement plan qualified disaster distributions - from 2021 Form 8915-E, Line 9- Report the one third amount of your 2021 qualifying distribution or your total distribution amount if you elected not to distribute over these years.
Any additional repayments made not previously claimed- Any qualifying repayment made during 2023.
Total Repayments from 2022 Form 8915F, Line 14 - Any repayment previously reported on your 2022 return.
Any amount from 2022 Form 8915F, Line 14 you carried back to a prior year- Report any amount you carried back if you report a new qualified distribution during 2022.
Total Income from 2022, Form 8915F, Line 13- Report the amount from line 13 of your 2022 8915-F. Generally this will match the distribution that was taxable but if you took additional distributions during 2022 and 2021 please review the 8915-F on your accepted return.
IRA Distributions
You should complete these lines if you received an IRA distribution.
Income for prior years from IRA retirement plan qualified disaster distributions - from 2022 Form 8915-F Line 22- Report one third of the qualifying distribution you made during 2022 or the full distribution if you elected not to distribute it over three years.
Income for prior years from non-IRA retirement plan qualified disaster distributions - from 2021 Form 8915-E, Line 17- Report the one third amount of your 2021 qualifying distribution or your total distribution amount if you elected not to distribute over these years.
Any additional repayments made not previously claimed- Any qualifying repayment made during 2023.
Total Repayments from 2022 Form 8915F, Line 25-Any repayment previously reported on your 2022 return.
Any amount from 2022 Form 8915F, Line 14 you carried back to a prior year- Report any amount you carried back if you report a new qualified distribution during 2022.
Total Income from 2022, Form 8915F, Line 24- Report the amount from line 24 of your 2022 8915-F. Generally this will match the distribution that was taxable but if you took additional distributions during 2022 and 2021 please review the 8915-F on your accepted return.
You can review the IRS instructions for the 8915-F for this and additional information here.
Who should file Form 8915-F?
IRS Form 8915-F must be filed by individuals who took distributions from qualified retirement plans due to specific disasters declared by the President under the Stafford Act and who have included such distributions in income in prior years. This form is also required for those who are repaying these distributions.
What is a Qualified Disaster Distribution?
A Qualified Disaster Distribution, for purposes of Form 8915-F, refers to a distribution from an eligible retirement plan that an individual receives as a result of a qualified disaster. Here's what qualifies a distribution as such:
- Qualified Disaster: The distribution must be related to a qualified disaster as declared by the President of the United States. Qualified disasters typically include events such as hurricanes, earthquakes, wildfires, floods, or other similar events.
- Eligible Retirement Plan: The distribution must come from an eligible retirement plan, which includes IRAs, 401(k) plans, 403(b) plans, and certain other retirement accounts specified by the IRS.
- Purpose of Distribution: The distribution must be for the purpose of providing relief to individuals affected by the qualified disaster. This could include covering expenses such as medical care, housing, or repairs to property damaged by the disaster.
- Timeframe: The distribution must be made during a specific time period that the IRS designates as falling within the period of the qualified disaster.
- Individual Eligibility: The individual receiving the distribution must have sustained an economic loss due to the qualified disaster, such as damage to their home or business, or being unable to work due to the disaster.
How Is a Qualified Disaster Distribution Taxed?
A Qualified Disaster Distribution may receive special tax treatment, and Form 8915-F is used to report such distributions. Here's how these distributions are typically taxed:
- Exclusion from Income: Normally, distributions from retirement accounts are included in the taxpayer's income for the year in which they are received. However, a Qualified Disaster Distribution allows the taxpayer to exclude up to a certain limit from their taxable income.
- Maximum Exclusion Amount: The maximum amount that can be excluded from income is generally $100,000. This limit is applied on a per-person basis, so if a married couple both experienced economic loss due to a qualified disaster, each spouse could potentially exclude up to $100,000 from their income.
- Repayment Option: Taxpayers who receive Qualified Disaster Distributions also have the option to repay the distribution to an eligible retirement plan within three years of receiving it. If the taxpayer chooses to repay the distribution, it will be treated as though it were repaid in a direct trustee-to-trustee transfer.
- Spread Over Three Years: Even if the taxpayer does not repay the distribution, the inclusion of the distribution in income can be spread evenly over three years, beginning with the year of distribution. This spreading of income recognition can help reduce the tax impact in any given year.
- No 10% Early Withdrawal Penalty: Generally, early withdrawals from retirement accounts before age 59½ are subject to a 10% penalty. However, Qualified Disaster Distributions are exempt from this penalty.
Qualified disaster distribution requirements
Qualified disaster distributions must satisfy the following conditions. (Distributions related to the coronavirus cannot be issued in 2021 or later years.) Each disaster you report on Form 8915-F must meet these criteria individually:
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The distribution must be issued:
- For 2020 disasters (excluding the coronavirus), no later than June 24, 2021; or
- For 2021 and subsequent disasters, within the designated qualified disaster distribution period. Refer to the section on Qualified Disaster Distribution Period for details.
- Your primary residence must be situated in a qualified disaster area at any point during the disaster period specified for that area. Refer to the section on Primary Residence for clarification. The qualified disaster area pertains to the state, territory, or tribal government where the disaster transpires.
- You must have incurred an economic setback due to the aforementioned disaster(s) in (2) above. Economic losses may encompass, but are not restricted to: (a) damage to or loss of real or personal property from incidents like fire, flooding, theft, vandalism, wind, or other causes; (b) losses associated with displacement from your residence; or (c) income loss due to temporary or permanent job layoffs.
If conditions (1) through (3) are met, you can generally classify any distribution (including periodic payments and mandatory minimum distributions) from an eligible retirement plan as a qualified disaster distribution, regardless of whether the distribution was made due to a qualified disaster. Qualified disaster distributions are permissible irrespective of your necessity or the actual extent of your economic loss. For a list of plans from which qualified disaster distributions can be sourced, consult the section on Eligible Retirement Plan.
Additionally, a reduction or offset of your account balance in an eligible retirement plan (excluding an IRA) for the purpose of repaying a loan can also be marked as a qualified disaster distribution. For further information, refer to the section on Distribution of Plan Loan Offsets.