My 1099-R taxable income from my traditinal IRA was reported without reduction for my QCD and rollover. The net effect of these two factors was to reduce the taxable amount to 0, which Turbotax handles nicely in the questions following the entry of the 1099-R. So far so good. With no IRA withdrawals as defined by the IRS in the instructions to Form 8606, I should not have to file an 8606 this year, and again, Turbotax properly does not include it in the forms to be filed. The problem is that if I switch to forms view and open the 8606, my basis in my IRA has been reduced by the exact amount of the QCD. Will this reduced amount on this unfiled form, but which is stored in Turbotax, actually decrease my basis when I file my 2021 taxes in 2022? If so, is this a program error or is there something in the tax law that I'm not understanding?
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I've revised my previous reply. My testing appears to indicate that the current release (R16.1) handles the combination of QCD and rollover correctly as long as the year-end balance in traditional IRAs has been entered.
If your 1099R was completed incorrectly, then you need to contact the administrator of the account to see if you can get a corrected tax reporting document.
Here is the way it should be reported:
Here is what you should see reported on the Form 1099R:
How do I report a qualified charitable distribution on my income tax return?
To report a qualified charitable distribution on your Form 1040 tax return:
You must also file Form 8606, Nondeductible IRAs, if:
For additional information refer to:
{Revised]
Make sure that you have entered your year-end balance in traditional IRAs. If your rollover wasn't completed until early 2021, be sure to include this amount as an outstanding rollover.
I've revised my previous reply. My testing appears to indicate that the current release (R16.1) handles the combination of QCD and rollover correctly as long as the year-end balance in traditional IRAs has been entered.
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