"You are correct. Currently, TurboTax is looking at the distribution from each 1099-R separately and will add the Form 5329 for the penalty without looking the the total of all the distributions added together. An update is being worked on. The amounts for the RMD are not reported to the IRS if there is no penalty, it is used by TurboTax for calculation of the penalty so you can wait for the update, or as a workaround answer Yes you will withdraw in the correction window so you can file now. "
I just finished my 2024 return. I answered "Yes" to withdrawing the balance during the correction window as advised. I also selected "Yes" to meeting the RMD for the year. The software then shows that the balance was taxed and asks if I would like to fill out a waiver. Whether I answer Yes or No TTax still generates a Form 5329 with an additional tax on the balance and includes this in my return.
Is there an ETA for the update?
