How to answer Turbo Tax's question about RMD as a beneficiary on an inherited IRA

[GW99]

My mother passed away in 2023.   Her RMD for the year was around $29,000.  At the time of death she had taken around $20,000 of her RMD, leaving $9,000 to still be taken.   Her IRA had 3 beneficiaries - her spouse (90%), me (5%), and my sister (5%).    I set up an Inherited IRA with my portion and I also instructed my advisor to process a $450 RMD for me (5% of the 9K left to take) so that I was taking my share of the remaining RMD.     

I am now doing my taxes and am a little confused on how to answer some of the questions in the Turbo Tax tool that is walking me through this part.   I have already told it that the IRA was inherited and that the $450 that I took was an RMD.   Now it is asking me for more information, and specifically these are the 3 questions:

1. {My Name} received all the RMD for 2023
2. {My Name} did not receive all the RMD for 2023
3. {My Name} was not required to take an RMD for 2023

Initially I thought the answer was 2, but when you pick that it takes you in to reporting as if you failed to take the whole RMD and need to ask the IRS for forgiveness.   But I took my share.   So now I am thinking maybe the answer is 1?   It seems weird because of course I did not receive the entire $29,000 RMD that was due for my mom.   But at least for my part of the inherited IRA, I took and received my entire portion ($450)?  Is that what #1 is saying?   I am leaning towards answering 1, but wanted some advice.  Thanks!

[MarilynG1 · Accepted solution]

Yes, that's correct.  Choose 1, you received all the RMD for 2023.

The IRS has no knowledge of your mom's required RMD amount, and who should get it.  They rely on the Plan Administrators to keep track. 

Here's more info on RMD's.

[dmertz]

Actually, it's the responsibility of the beneficiaries to coordinate among themselves to complete the year-of-death RMD, not the responsibility of the IRA custodian.  Absent such coordination meant to ensure that the RMD has been satisfied by some combination of distributions by beneficiaries, it's reasonable to consider that your portion of that responsibility has been satisfied by you taking a distribution to your proportionate share of the remaining RMD and that with respect to your tax return, you have received all of the RMD for 2023.

[Alishals]

Hi, I have a very similar situation and have a follow on question. I am asked what the total RMD should have been in TurboTax. I have been entering the amount my deceased loved one should have taken. Should I only be be entering my portion of the RMD? (I have the IRA in the same investment from that my relative did and when I login to enter, her 1099R also gets entered into the system, but there is no way to indicate that it is not my IRA).

[dmertz]

"Should I only be be entering my portion of the RMD?"

Yes, only enter as the required amount only the portion that you were required to take.

"there is no way to indicate that it is not my IRA"

Depending on which version of TurboTax you are using, on one of the pages that follow the entry of the Form 1099-R details, TurboTax will provide a checkbox will ask an explicit question where you will indicate that the IRA is inherited.