2021 Tax Year - 1099R and RMD

[rjs]

What are the exact amounts on Form 1040 lines 4a and 4b?

[tbs528]

34,669 and 17,243 and 4b states rollover 

[dmertz]

So it seems that your tax return reports IRA distribution(s) totaling $33,669, of which you indicated you rolled over $17,426, leaving $17,243 as taxable.  As long as your RMD from your IRAs was $17,243 or less (and assuming the distribution(s) were not from an inherited IRA to a non-spouse beneficiary; the code 7 indicates it was not from an inherited IRA), your tax return seems to report the correct taxable amount.

Assuming that the rollover was to an IRA, do you have a Form 5498 that reports receipt of the rollover contribution?  If the rollover was to a qualified retirement plan like a 401(k), receipt of the rollover is not reported to the IRS by the receiving plan and the IRS sometimes questions these so-called "reverse rollovers."

[Critter-3]

If you indicated that a portion was rolled over then the IRS would look for that amount to be reported on a form 5498 from the place you rolled the distribution to ... so did you actually roll over that amount?   If so present proof to the IRS in response to the notice. 

[fanfare]

Whenever you do something "unusual", IRS requires an explanation statement attached to your filed return.

That would have avoided your problem.

@tbs528 

[tbs528]

Thanks but what I did is something I do every year as I do not always need/want the RMD.  It has never been considered unusual before and not sure why it would be this time.

I responded to IRS that I disagreed and I provided them documentation and copies of why I disagree and records for their perusal.  Just waiting to hear back.

[Critter-3]

Wait wait wait ... you cannot roll the RMD back into any kind of retirement account  even if you do not want it all.  The full RMD must come out of the IRA and stay out of the IRA.  So if that is what you did the IRS is correct. 

[dmertz]

@tbs528 , you previously said that only about half of the distribution was RMD and that you rolled over the portion that was not RMD.  Now you seem to be saying that all of the distribution was RMD and that you impermissibly rolled over a portion of your RMD.  Which is it?

As Critter-3 said, the RMD-portion of a distribution is not eligible for rollover.   However, properly entered into TurboTax, TurboTax will prevent you from reporting the portion that is RMD as having been rolled over.  If you tell TurboTax that you rolled over more than the portion that was not RMD, TurboTax won't explicitly tell you that you that you impermissibly rolled over an RMD, TurboTax will just limit the amount excluded from line 4b to the amount in excess of the RMD.

[tbs528]

Rolled over everything but the RMD ... that is what the 1040 reported ... IRS is saying I owe taxes on full gross distribution -- I agree I owe on the RMD portion but do not agree that I owe on the excess above RMD that I rolled over ... response has been submitted so we will find out ...

Appreciate all the responses