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user17691996923

Level 2

Solved

RMD penalty

Forum|Forum|4 months ago
January 23, 2026
2 replies
0 views

Traditional IRA plus inherited. Distributions taken from both accounts exceeding RMD for 2025. Traditional IRA distribution less than calculated RMD. Inherited distribution to close account taken to reach combined RMD for 2015. TurboTax says I am short on RMD and owe tax on shortage? Why? An example for illustration:

Traditional IRA RMD 20,000. Distribution taken 18,000

Inherited RMD 110. Distribution taken 2300

Total distribution is above combined RMD. There should be no penalty.

Did I enter something wrong in TurboTax? How does this get corrected?

Thank you fr any assistance

Best answer by dmertz

As fanfare indicated, you are $2,000 short on your own traditional IRA RMD because distributions from the inherited IRA do not count toward the RMD on your own IRA. You'll need to complete that RMD as soon as is practical, after which you can indicate that you made the corrective distribution within the correction period, reducing the penalty to 10%, $200, which you can request be waived for reasonable cause. TurboTax provides the means to make the request.

Level 15

You can't apply Inherited IRA distribution to Traditional IRA RMD.

Therefor, you are short and will have a penalty unless you can get IRS to waive the penalty.

@user17691996923

user17691996923Author

Level 2

Thank you for the quick reply. Live and learn.

dmertzAnswer

Level 15

As fanfare indicated, you are $2,000 short on your own traditional IRA RMD because distributions from the inherited IRA do not count toward the RMD on your own IRA. You'll need to complete that RMD as soon as is practical, after which you can indicate that you made the corrective distribution within the correction period, reducing the penalty to 10%, $200, which you can request be waived for reasonable cause. TurboTax provides the means to make the request.

user17691996923Author

Level 2

Thank you. Appreciate the help. Went through the process a few minutes ago.