Multiple 1099-Rs - How to properly report in Turbotax

[siyang2]

I have an IRA account at a major brokerage.  I take out monthly distributions from this account.  In the middle of 2025, I purchased an annuity using half of the funds from this account and began receiving monthly annuity payments.  I also continued taking monthly payments from the IRA.  I received 1099-Rs from both the brokerage and the annuity company.  The brokerage company reported to me my RMD for 2025 based on the IRA balance Dec 31, 2024.  My actual 2025 IRA distributions were less than the reported brokerage RMD, but my combined monthly annuity and brokerage distributions exceed the brokerage RMD amount.   What amount do I report in Turbotax when it asks me what my required RMD for both the IRA and, separately, the annuity are?  If I report the brokerage RMD in Turbotax, it thinks I underpaid my RMD for 2025 and wants to assess me a penalty.  What number will the IRS use for both accounts?  Help.

[RogerD1]

The RMD for 2025 is based on the value of the IRA at the end of 2024, so that RMD would be satisfied if the total amount of annuity payments that you received plus the withdrawal from the IRA were equal to or greater than the RMD amount, which is the case for you.

To report this in TurboTax, take the RMD amount and subtract the total of the annuity payments from that.  This difference will get reported as the RMD for the amount of the IRA withdrawal, and the total annuity payments will be the RMD for that amount.  This will cause the penalty amount to disappear.

Example:  Your RMD was $20,000 for 2025.  In 2025, you received $11,000 from the annuity and $14,000 from the IRA.  Because the total of those two payments exceed $20,000, you have met the RMD.  In TurboTax you would report:

• $11,000 for the RMD of the annuity
• $9,000 for the RMD of the IRA ($20,000 RMD - $11,000 RMD used for the annuity)

For 2026 and future years, you will still have just a single RMD amount even though you now have two accounts - the IRA and the annuity IRA.  It's entirely likely that the payments from the annuity IRA will be greater than its individual RMD amount.  If this is the case, there is a provision in Secure Act 2.0 where the excess of the annuity distribution over its individual RMD can be used to offset the RMD from the IRA - meaning that the total withdrawn from both accounts must be at least equal to the single RMD determined from the total of all traditional retirement plan accounts.