Also you need to explain that only $100K of the $200K can be a covid distribution and if taxes were withheld it will only go against current 2020 return and they will have  balances due for 2021 and 2022? Oh did you ask if they had covid with a cdc approved testor household member or that they suffered an adverse financial effect? I had clients with neither and actually made more money than last year without the covid distribution and used money to buy a vacation home. SO not COVID related - SO fully taxable this year.