RMD Penalty

[fhcotton]

I have an IRA and a variable annuity each of which require withdrawing a Required Minimum Distribution (RMD).  In both the 2023 and 2024 tax years, I met the total RMD requirement with the total amount withdrawn, even though the amount withdrawn from the IRA was insufficient to meet the RMD requirement for the IRA.  The Tax Year 2023 TurboTax Deluxe interview questions and software did not identify a penalty was required for excess accumulation; however, the Tax Year 2024 TurboTax Deluxe interview questions and software do identify that a penalty is required.  Based on IRS Publication 590-B (2024), page 12, in the paragraph headed "More than one IRA", no penalty is required.  Has there been or will there be an update to the Tax Year 2024 TurboTax Deluxe interview questions and software to correct this?

Thanks,

Ford Cotton

[DanaB27]

To clarify, is the annuity an IRA? If yes, then you are able to take the RMD from any IRA account.  Please see Can an account owner just take a RMD from one account for additional information.

1. Click on "Search" on the top right and type “1099-R”
2. Click on “Jump to 1099-R” and enter your first 1099-R
3. On the "Required Minimum Distribution" screen enter RMD for this account 
4. On the "How much of This Distribution Applied to your December 31, 2024 RMD" select "The entire distribution applied…"  / or select "Some of this distribution…" and enter the RMD amount (if this distribution includes RMD for other IRA accounts then you included the amount here)
5. On the "Your 1099-R Entries" screen add the second Form 1099-R and answer the RMD questions.
6. On the "Your 1099-R Entries" screen click "Continue"
7. On the "Did You Miss a Required Distribution From Any Retirement Accounts?" screen select "None of these plans failed to withdraw the RMD" if you met all of your RMD for 2024.