Adjusting gross distribution from IRA for QCDs and after-tax contributions

[tjmcd3]

In the past I was always prompted by Turbo Tax after uploading my 1099-R  to enter the amount of after-tax contributions and QCDs as adjustments to the gross distribution. This year there were no prompts to make those adjustments so the gross distribution appears as fully taxable income. This section of Turbo Tax has been unavailable due to the tax law changes until today (Jan. 23, 2026), so it might be there are still bugs to be worked out. But it seems the whole interview process has been stripped of pretty important elements. This renders the system practically worthless in my opinion and I might as well just use the free IRS system.

[dmertz]

In this area the behavior of TurboTax Online is unchanged from 2024 TurboTax.  The page that asks, "Do any of these situations apply to you?" has a box to mark to indicate that you had a portion transferred to charity.  TurboTax asks for your basis in nondeductible traditional IRA contributions and your year-end balance in traditional IRAs after you click the Continue button on the page that lists the Forms 1099-R that you have entered.

[tjmcd3]

I'm sorry, but as I proceed through the Interview after my 1099-R has been entered, I received the following prompts:

• Is the IRA/SEP/SIMPLE box on this 1099-R checked?
• Where is your distribution from? Military pension or survivor's benefits, Disability benefits (under age 65 only), Three-year rule pension or 401(k) benefits, General rule pension or 401(k) benefits, None of the above. 
• What kind of retirement plan do you have with [XYZ] Custodian?
• Do any of these situations apply to you? The situations are I took out this money due to a qualified disaster, This money was from being a public safety officer. I took out this money due to a qualified disaster, I need to file a substitute 1099-R or the corrected box is checked on this 1099-R.
• Was This Distribution From a 403(b) Plan?
• Let's get more information about your Required Minimum Distribution (RMD)
• How much of this distribution applied to your December 31, 2025 RMD?
• Annuity information [I don't recall this ever having been asked in the past]

After which it reverts to "Your 1099-R Summary." Nowhere is there a box to indicate the portion transferred to charity nor am I asked for the basis of nondeductible traditional IRA contributions.

[SteamTrain · Accepted solution]

@tjmcd3 

OK, I can get the same set of follow-ups...but ONLY if I failed to check the IRA/SIMPLE/SEP box

...i.e, a QCD can only come from one of those IRA types.

________________

IF it was from one of those IRA types, make sure you check that box.

Then when you get to the "Do any of these situations apply to you?"  page

...there is a much longer list of check boxes, and 2/3rds of the way down is a checkbox for "I transferred all or part of this money directly to a charity" 

.... and proceeding from that page you'll be able to indicate how much 

......(after indicating all was an RMD....)

___________________

No, I don't know what happens with basis, I didn't see that part either.  But it wouldn't be needed unless you made non-deductible (after tax) contributions to that IRA     See below

[SteamTrain]

Ahhh, I found where it asked about non-deductible contributions.

When you get out to the table of 1099-R forms, you click on the Done, and after a couple more disaster questions, you finally get the Q about non-deductible contributions to  IRAs.

The software probably waits until then to ask, because some folks have, and may take distributions from separate IRA accounts , and the nondeductible contributions calculation will apply to all of them.

[tjmcd3 · Accepted solution]

Thanks! That was a helpful tip on the IRA/Simple/SEP. For some reason “No” was preselected by TurboTax after I’d uploaded the 1099-R file (my custodian had it available for me to download directly but the feed to TurboTax isn’t available yet). I carelessly thought that question applied just to Simple/SEP situations and not traditional IRAs. So the QCD section worked after all. 

I thought I’d reached the summary table of 1099-R forms and there wasn’t anything after that but I’ll try again. Appreciate your assistance. 

[NotaGuru]

When manually entering IRA income from brokerage's 1099-R, I get the message "Amount donated shouldn't be greater than Total Distribution" (aka RMD); I agree.  However, it appears the program does not allow for a QCD to be larger than the Gross (aka Normal) Distribution.  I verified the data is correct.  If I enter the QCD amount to be equal to the Gross amount the error message disappears.  Am I the only person having this problem??  

Am using TurboTax 2025 Premier Desktop (Win11) with today's latest update.  My apologies if I am posting this incorrectly.

[dmertz]

It's impossible for a QCD to be greater than the gross amount distributed.  If more was contributed to charity than the amount distributed, the amount beyond the gross amount distributed had to come from some other funds.  A charitable contribution made using funds that did not come from an IRA would have to be claimed on Schedule A.

If QCDs were made from more than one IRA such that you have more than one Form 1099-R from IRAs, you must enter the QCD amount made from each IRA separately.

[MsJulie]

I have the same problem.  I cannot complete my taxes because is this.  I also have the Premier version and it is now March 17.  Will this be fixed or what?  I  have been using Turbo Tax for for 30 years!!!!!  

[RogerD1]

If the issue you are seeing relates to either reporting a QCD or reporting non-deductible contributions, are you able to follow the directions given by @SteamTrain earlier in this thread to resolve the problems?  If those directions don't help, are you seeing other issues?  Please provide as much detailed information as possible (no personal info though) in a reply as that will help us to better help you.

If you made a Qualified Charitable Distribution from your IRA, bear in mind that you are required to be over 70-1/2 years old at the time you make the distribution.  As an example, if your date of birth was May 1, 1955, you would have had to make the QCD on November 1, 2025 or later in order for it to qualify as a QCD.  If you birthdate was not before July 1, 1955, you would have been ineligible to make a QCD at any time in 2025.  So in the instance that you made a QCD and were born after June 30, 1955, the questions about QCD contributions would not appear in TurboTax.

[debo9]

yes they have **bleep**ed it up, if I put in the QCD they then ask me what the QCD was and deduct it twice