DanaB27,
Thanks for the help you have provided with this difficult subject!
TurboTax multi-IRA distribution seems to work for a fairly simple case, but that’s not what I have.
Here’s my case (using imaginary figures), and I NEED HELP to find a way to make TurboTax to work:
- I have three IRAs. Let’s call them IRA-a, IRA-b, and IRA-c
- IRA-c was funded mid-year by a transfer of funds from IRA-b to IRA-c
- That means IRA-c has no RMD (because it’s value was zero on 12/31/24
- Overall 2024 RMD requirement: $30,000 (set by the IRA values on 12/31/2023)
- RMD for IRA-a: $20,000
- RMD for IRA-b: $10,000
- RMD for IRA-c: $0 (because it’s value was zero on 12/31/24)
- Total DISTRIBUTIONS taken in 2024 and shown on the 1099Rs: $60,000
- 1099R for IRA-a: $35,000 distribution
- $30,000 of the distribution was via QDCs for IRA-a
- I took an extra $5,000 in the distribution to cover a RMD shortfall from 2023
- No 1099R sent for IRA-b because I did not take any distribution from that IRA
- 1099R for IRA-c: $25,000 distribution
- I chose to take a $10,000 distribution from IRA-c to cover the remaining part of my overall RMD not covered by QCDs
- $15,000 distribution for a Roth conversion
The desired state (I think) on Form 5329 “Part IX Additional Tax of Excess Accumulation Smart Worksheet”:
RMD for Account: Distributions: Undistributed RMD
From Form(s) 1099-R $20,000 $30,000 $5,000
Additional (enter): $10,000 $25,000
Total: $30,000 $60,000
I followed your very clear example in this way:
- For IRA-a:
- “Required Minimum Distribution” screen: $20,000
- Marked “The entire distribution applied to the RMD”
- Marked “part of this distribution transferred to charity”
- QCD screen: $30,000
- “How much of this Distribution Applied” screen: entire amount
- For IRA-b: No 1099R so no entry and no place to make an entry
- For IRA-c:
- “Required Minimum Distribution” screen: $0
- QCD screen: None
- “What did you do with the Money” screen: marked “combination of rolling over, converting, or cashing out the money”
- “Amount converted to a Roth IRA account”: $15,000
- “How much of this Distribution Applied” screen: entire amount
What the 5329 Smart Work shows:
RMD for Account: Distributions: Undistributed RMD
From Form(s) 1099-R $20,000 $35,000 $0
Additional (enter): $25,000 $25,000
Total: $45,000 $35,000 $10,000
I realize that this example sounds like the examples the IRS uses in their instructions (cram every possible scenario into one example). But, that is really the case I have. I sure wish I had not done it this way, because I had no idea of the tax reporting chaos I was inflicting on myself. I won’t do it this this in the future!
PLEASE, share you expertise with me so I can file my taxes. I am willing to use the TurboTax interview method or put the information directly into the IRS forms via the forms method. I just need the knowledge of how to proceed.
Thank you!!
