Cannot enter a amount into Schedule 1, line 24z for a uncommon case on 2023 Turbotax Deluex Desktop version

[wc158]

My IRA distribution in 1099R 2023 from the financial company contains an adjustment which already paid tax at March 2023 for 2022 tax year due to it's a missing 2022 RMD $2000,. I do have a confirmation letter from the company on adjustment but they declined to issue a corrected 1099R to take off the adjustment because they had to report all distributions in 2023 no matter what, and ask myself to make a adjustment on my tax return with an explanation. So I tried to enter an amount into Turbotax 2023 Schedule 1,line 24z as indicated in IRS instruction"to report any adjustment not reported elsewhere". But Turbotax2023  does allow me to enter anything into line 24z. How to do this data entry?

[AmeliesUncle]

Are you saying you reported the $2000 RMD on your 2022 tax return, even though you didn't receive the $2000 RMD until 2023?

If not, maybe you could clarify or expand exactly what happened and when.

[wc158]

Thank you for asking.

Here are some details on this issue: When I prepared my 2022 tax return in Feb. 2023, I found that I forgot to take 2022 RMD by the end of 2022, and the financial company hosting my IRA account  also forgot to remind me before I requested a Roth conversion so that the 1099R of 2022 contained Roth conversion only. After I contacted the company, in March 2023 they did distribute $2000 missing 2022 RMD with a letter confirming this "Adjustment". Also they sent me a corrected version of 2022 1099R including the amount of missing 2022 RMD, and I filed my 2022 tax return based on this corrected 1099R in April 2023.

[RobertB4444]

If you have already paid tax on the amount on your 2022 return then you should adjust your 2023 1099-R to reflect the correct amount that should have been on there.  Remove the portion that was added to your 2022 1099-R.  You don't need to enter anything into line 24z.

Since you are changing the 1099-R you will want to keep copies of the original and corrected 2022 1099-Rs as well as the 2023 form in case the service sends a letter requesting an explanation for the change.  Copies of those forms along with a letter from you should be all that you need,

@wc158 

[AmeliesUncle]

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@wc158 wrote:

After I contacted the company, in March 2023 they did distribute $2000 missing 2022 RMD with a letter confirming this "Adjustment". Also they sent me a corrected version of 2022 1099R including the amount of missing 2022 RMD, and I filed my 2022 tax return based on this corrected 1099R in April 2023.

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You may consider switching to another company.  Besides not reminding you about the RMD, they completely screwed things up.

If you they did not distribute that amount until 2023, they should NOT have amended the 2022 1099-R.  It belongs on your 2023 tax return, not your 2022 tax return.

[wc158]

Thanks for your understanding on my case.

Actually my question in first place was HOW TO "remove the portion in 2022 1099R" from 2023 1099R inside  TurboTax desktop version? Without entering this amount into Schedule 1,24z? Do you suggest that I should manually modify the amount at 2023 1099R which the company also reported to IRS? Will this kind of data-mismatch trigger an auditing by IRS?

[wc158 · Accepted solution]

Thank you so much for your advice. Here is what I am going to solve this problem:

1.  In 1099R-line2a<taxable amount> subtract the adjustment to avoid double-taxation with explanation.

2. In 1099R-line1<gross distribution> subtract the adjustment with a note: "

To avoid double-taxation,this adjustment should be subtracted from <taxable amount>. But there is a Turbotax software bug which mistakenly links 1099R-Line1(gross distrib) into 1040-Line4a(taxable amount), instead of 1040-Line4b(taxable amount) as it should. So 1099R-Line1 also has to be subtracted  for the adjustment (Turbotax filing only)"

wc

[AmeliesUncle]

As I said before, if the distribution was made in 2023, you need to pay tax on the distribution on your 2023 return.

It sounds like your 2022 tax return had incorrectly claimed the distribution, so you may want to amend your 2022 tax return.

[wc158]

Unfortunately this NOT an option since the company declined to issue any amended 1099R for either 2022 or 2023.

[AmeliesUncle]

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@wc158 wrote:

Unfortunately this NOT an option since the company declined to issue any amended 1099R for either 2022 or 2023.

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You are already doing a work-around to change your 2023 return.  But you are doing it illegally and almost certainly will receive an IRS notice/audit.  It is income for 2023.  If the won't correct the 1099-R for 2022, you should do the work-around on the amended 2022 tax return.