Form 1099-R: Required minimum distribution box should have a selection if there was an RMD for this account.

[befuddled4]

I am in the Smart Check phase near the end of doing my return, and TurboTax tells me to "Check This Entry".

For one of my 1099-R's, it says, "Required minimum distribution box should have a selection if there was an RMD for this account."

I am given a 3-way radio button, telling to pick one of:

• No Entry
• Yes RMD
• Not all RMD

I don't understand why I'm getting this message. The 1099-R is from an Inherited Roth IRA-BDA account. I've had this account for about 5 years now. Every year, I have an RMD for it, which I take out. I don't remember getting this problem in previous years.

The 1099-R is from Fidelity. It is pretty basic:

Box 1 has my gross distribution which is what my RMD is (with a possible caveat that I may have taken around $1 extra this year because earlier this year I got a disagreement about what my RMD by about $1, so I used the bigger number).

Box 2b is checked for Taxable amount not determined.

Box 7 distribution code is T.

There is no box for Required minimum distribution. I compared to previous years, and my form is the same.

I notice that if I select "Yes RMD", my Federal Tax Due goes down, but if I pick either of the other two options, my Federal Tax Due goes up. This is a Roth-style distribution, so it should not have any taxable value. 

I'm inclined to pick "Yes RMD", but this whole behavior doesn't make any sense to me, so I felt I better ask here before doing anything.

Can somebody explain why TurboTax has a problem here, and what I should be doing for this case?

Thank you

P.S. When I select "Yes RMD", and continue, I immediately get another Check This Entry complaining, "Correction Window must have a selection to indicate whether corrective distribution was taken during the correction window. Check the box based on any corrective distributions for this account only.

• No entry
• Corrected - Yes
• Corrected - No

This seems really wrong, and really worries me. And I have no clue what to do here.

[fanfare · Accepted solution]

TurboTax is trying to ask you for a selection, not for a mark on the 1099-R which is not there.

Since you have an RMD to be taken, say YES

@befuddled4 

Due to bugs in 2024 TurboTax ,it is important to tell TurboTax that the distributed amount is the calculated required amount.

[fanfare]

what was the box 7 code on your prior 1099-R that you looked at for comparison??

[befuddled4]

Last year, the Box 7 code was the same as this year, "T".

[fanfare]

Due to TurboTax problems,

the alternative workaround is to

1) delete 1099-R

2) reenter the 1099-R, stating

3) "No RMD was required".

@befuddled4 

If you go through the q&a you should not be looking at a worksheet.

[befuddled4]

Thank you. I experimented with both different paths you suggested. In the first path, I followed up with selected "No entry" instead of either of the corrected. After a couple of iterations, the Smart Check stopped finding problems.

Going the other path, the UI made sure to tell me it didn't think entering 0 for RMD was correct. Smart Check stopped finding problems.

In both paths, my taxes due end up coming out the same. 

I decided to go with the first path since I'm more comfortable giving it the correct value for the RMD.

Thank you for the help.

[fanfare]

Now that that's settled,

What is the taxable amount on a distribution with Code "T"  ?

@befuddled4 

[befuddled4]

This is an inherited Roth IRA-BDA, so none of this is supposed to be taxable. It meets the more-than-5-years since the Roth IRA was established, the original person died before 2020 (legacy withdrawal rules), and the person was over 59.5 when died.

I don't remember all the questions TurboTax asked me about this or the Code T. Is there something you think I should be looking for to confirm?

I looked at the generated Form 1040 (first page). The numbers put in for IRA distributions for 4a and taxable amount 4b seem to be reasonable for me. (I also have an inherited traditional IRA.) The total for 4a is the combined T-IRA-BDA + Roth IRA-BDA, and the taxable amount in 4b is just the T-IRA-BDA component. This implies to me that TurboTax correctly did not count the Roth IRA-BDA as taxable.

[fanfare]

With that code, you have to answer the question about the five-year rule.

Which you did, so yout tax is zero.

@befuddled4