Retirement tax questions

The 10 year rule includes 2 parts.  You must withdraw all the money within 10 years, AND you must take RMDs based on your own lifespan until the account is closed, assuming the previous owner was older than their own RMD beginning age.  However, the RMD rule has not been finalized and the IRS has indicated it will not penalize anyone who fails to take an RMD for 2021, 2022 or 2023.   Expect that you and your sister will be required to take RMDs for 2024.  (Because the rule is not finalized, it is not written into the instructions, either.  But it is definitely coming.)

 

So you should probably indicate that part of the withdrawal was an RMD, and use the tables in publication 590-B to determine how much your RMD was.  

 

However, the only effect of telling Turbotax that part of your withdrawal was an RMD, is that RMDs are not eligible for rollover or for contributing to your own IRA, and turbotax will check that for you to make sure you had enough other income to allow a contribution.  If you did not rollover the IRA, and did not make new IRA contributions (or your compensation is enough to cover any new IRA contributions), then your return won't be affected if you were to answer "none". 

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