RMD taken correctly, but penalty assessed

[SPQ]

I would not stress about this.  As long as the proper RMD amount is included on the 1040, (line 4a on my return), you should be fine, even if you tell TT the RMD amount is 0.  I am not dismissing the justified aggravation, which I share, but TT has had time to fix this, doesn't seem to have done it, so self-help is appropriate.

[TBGrant]

OK, time for a painful confession...

I was taking my figures from the 2024 tax information provided by my broker. The provided RMD sheet clearly states that the cited amount applies to the 2025 distribution based on my account balance as of 12/31/24. So my 2024 RMD, documented in last year's paperwork, was smaller than the distribution required  to take place in 2025 (the one I was entering into my return), hence the penalty! 

For others who are suffering under this "glitch", I recommend you go over your figures and see if you are doing something similar.

To SPQ, arusso03, TerriLa and anyone else who may have been getting grumpy about this topic, thank you for your kind words and thoughts.

To TurboTax, I apologize for my evil thoughts and unhappy words, uttered in confusion and distress. I am back on board...

[arusso03]

Great news! And a good insight in case anyone else is possibly picking up the wrong info.

I know mine worked out pretty soon after TT did some kind of corrective update, but it sounded like others (including yourself) were still having issues.

All's well that ends well!

[TerriLa]

Mine never did work out.  Wonder if it has something to do with the different packages?  I used the home/business software.  I finally just put $0 in as my RMD and went with it.  Still flagged it as an error and told me to remove the amount.  So I did and filed it last night.  It says it has been approved by the IRS and I should be getting my refund soon.  Since TT and TacAct showed the same refund due, I took my chance.  I am just really dissatisfied, disappointed and frustrated that TT hasn’t done anything to fix the software issue for most of us and that we had to find our own workaround.

[Tmc-Njc]

Coming late to this convo, but glad to see it. Same issues here on the RMD for an IRA. Interestingly we also have a 401K with an RMD and it when fine, no penalty, even though we did exactly the same steps as for the IRA. Anyone else have this situation?

[DanaB27]

If you are using TurboTax Desktop please make sure you have updated the software.

It sometimes helps to delete and reenter the Form 1099-R and then go through the RMD questions again.

To confirm you took your full RMD for 2024 from the IRA? Please see Can an account owner just take a RMD from one account for additional information.

@Tmc-Njc 

[robinson1025]

I HAVE THE SAME PROBLEM…WHAT IS GOING ON.   I am using TURBO TAX PREMIER.

[robinson1025]

Not corrected.   I am doing my taxes now, March 31.

[robinson1025]

It is March 31 and this glitch has not been updated.   I still have an issue with the MRD penalty.  

[robinson1025]

Still not fixed as of March 31.

[DanaB27]

It would be helpful to have a TurboTax ".tax2024" file that is experiencing this issue. You can send us a “diagnostic” file that has your “numbers” but not your personal information. If you would like to do this, here are the instructions for TurboTax Online: 

1. From the left menu select Tax Tools. 
2. Then select Tools below Tax Tools. 
3. A window will pop up which says Tools Center.  
4. On this screen, select Share my file with Agent. 
5. You will see a message explaining what the diagnostic copy is. Click okay through this screen and then you will get a Token number. 
6. Reply to this thread with your Token number and add @DanaB27 . This will allow us to open a copy of your return without seeing any personal information.  

The instructions for TurboTax Download: 

1. On your menu bar at the very top, click "Online"
2. Select "Send Tax File to Agent"  
3. Click "Send"
4. The pop-up will have a token number
5. Reply to this thread with your Token number and add @DanaB27 . This will allow us to open a copy of your return without seeing any personal information.  

We will then be able to see exactly what you are seeing and we can determine what exactly is going on in your return and provide you with a resolution.

@robinson1025   

[Tmc-Njc]

I am using the online version, so no software to update.

Yes, I took the full RMD from a single IRA, so it is not an issue of multiple IRAs and taking the RMD for several from just one. This is a straightforward single IRA issue.

I was on a chat with a TT rep for a long time yesterday and did all they told me to, such as deleting the IRA entry, clearing computer cache, cookies, browser history, rebooting computer and starting the IRA entry over. Same result (3 more times through that whole process).  Same penalty assessed each time. I even tried showing that the required RMD was $0, but while others had that work, I did not. Same penalty.

I'll try to send the diagnostic file as you suggest below. 

[Tmc-Njc]

@DanaB27    The token number is 1298159

[DanaB27]

I reviewed your return. You have on Form 1099-R with code G 4 where you answered you had a RMD but nothing of the distribution was applied towards the RMD. Please enter enter $0 for the RMD on the "Required Minimum Distribution" screen for this Form 1099-R with code G 4. It seems you have a second Form 1099-R for this account where you took the RMD.

@Tmc-Njc 

[Tmc-Njc]

Thank you, that resolved the problem and removed the penalty. It seems odd though that the issue was with a 401K rather than the IRA. Each time I added the IRA in, the penalty appeared. When I removed the IRA, the penalty also disappeared. So I assumed the issue was the IRA RMD and not the 401K RMD.

Anyway, thanks again for seeing where the error was. I would encourage others with this problem to provide a TT expert with a diagnostic file of their return in hopes their issues are as easily resolved.