qbteachmt
Level 15

"BEFORE the repayments are applied"

And we don't know if the repayments were all in 2020, all in 2021, or split across the years. The 1099-R should show any repayments.

"So $33,333 would be taxable in 2020 without a repayment. The repayment gets applied to the current tax return first so it offsets all of the $33K income. The remaining repayment is carried forward."

That's why the instructions mention if the repayment is before the tax return got filed, or you would need to amend going back to the first application of repayment, and working your way forward.

Which is why it helps to read the form instructions.

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