2024 Taxes on Inherited Traditional IRA RMD distribution not being calculated in Turbo tax

[Lisa092]

In 2024, I inherited a traditional IRA from my Dad who passed away.  I took the required RMD distribution from the account by 12/31/24 as he had not taken the RMD in 2024 yet. In understand this distribution should be taxed. Turbo tax is not taxing this amount. Can you help? 

[MarilynG1]

Yes, the distribution should be taxable, unless a different taxable amount is shown in Box 2a.  If your dad's IRA was funded by after-tax money, it's possible it may not be taxable (or not fully taxable), which the Box 2a amount or an amount in Box 5 could indicate.

What are the Codes in Box 7 on your 1099-R?  

You could delete/re-enter the 1099-R, paying close attention to the follow-up questions, until you reach the end of that section.

Here's more info for an Inherited IRA and Inherited Retirement Plan.

Sorry for your loss.

@Lisa092 

[Lisa092]

Thank you so much for your condolences. You are very kind to offer guidance and the reading material. I do have a taxable amount now on Line 4B in Turbo when I previewed my 1040 form. Dad did have nondeductible contributions on form 8606 for this inherited traditional IRA. I was not sure where to add in that fact to get to the taxable/non taxable amounts to appear in Turbo. Any suggestions? I have not gone back and re-entered data. I shall await your response before I do that.  

On the 1099R, the same amount is in Box 1 and 2a. 2b is also checkmarked. Box 7 is K4 with a checkmark in the IRA/SEP/Simple. No Box 5 entry. 

With appreciation! 

[dmertz]

TurboTax is incapable of preparing the Form 8606 used to calculate the taxable amount of a traditional IRA contribution from an inherited IRA.  You'll have to do that calculation yourself on a Form 1099-R outside of TurboTax.  Do not include any information on that form about your own IRAs; information about your own IRAs must be kept entirely separate from the information about the IRA inherited from your father.  Once you have determined the taxable amount, during the entry of the code-4 Form1099-R and additionally indicating to TurboTax that it was a distribution from an inherited IRA, TurboTax will ask you to enter the taxable amount that you calculated outside of TurboTax.

The "K" in ox 7 indicates that the IRA contains assets that do not have a readily available Fair Market Value.  This could complicate determining the amount that you must put on line 6 of the Form 8606 that you prepare outside of TurboTax.