After you enter the 1099-R in Federal > Wages and Income > Retirement, there is a question that asks about QCD.
Note that the TT Summary will still show the gross figure, but that is only FYI. Look at lines 4a and 4b of Form 1040.
Also note that some states do no recognize QCD's, so you may still owe state taxes.
I took the RMD from my IRA. Part of this was a QCD. I entered the 1099-R information correctly on the worksheet. The RMD shows up correctly on line 4a of form 1040. However, line 4b shows up as 0. I can’t override the program and enter the correct amount.
As long as your QCD would have otherwise been taxable, TurboTax is calculating this correctly. I realize now you are seeing that TurboTax was not splitting out the QCD portion so that the remaining portion was still taxed.
When entering your 1099-R and QCD transactions:
When finished, the 1099-R box 1 amount will go to your Form 1040 IN FULL on line 4a. Line 4b (taxable amount) minus the QCD amount will post on line 4b and "QCD" will be written in below Line 4a automatically.
To verify your entry of this in TurboTax:
Enter your 1099-R by starting from the left navigation pane>Federal>Wages & Income
Scroll down to Retirement Plans & Social Security>Show More> IRA, 401(k), Pension Plan Withdrawals (1099-R)
- Enter in the full amounts for Box 1 Gross Distribution and Box 2a Taxable Amount as if you did not have a portion designated as a Qualified Charitable Distribution.
- Enter in the Box 7 distribution code exactly as issued on your 1099-R
- Answer the questions that follow about whether it was an IRA or inherited and click Continue.
- Next, answer the questions about the withdrawal as a required minimum distribution and click Continue.
- On the Transfer to Charity screen, select "I had part of this distribution transferred to charity and click Continue.
- Enter the amount that was sent to the Charity on the next screen and click Continue> Continue> Continue.
Checking the 1099-R Worksheet and scrolling down to the QCD section, you will see the QCD amount. Note that the system posts the same amount in the next section below as the RMD even though the full amount is posted in the 1099-R taxable amount at the beginning of the worksheet.
This charitable donation should NOT be included again in your Deductions & Credits section as a Charitable Donation since you have already received a tax benefit. There is no place or need to record who received the donation.
These are the most current IRS resources available for more details as of this posting date:
[Edited 1/27/2020 7:10 AM PST]
Let me give an example Lets say my gross distribution on my 1099-R was $10,000. That appears correctly on line 4a of my 1040. Of that $10,000, $2,000 was a QCD. I entered that on the 1099-R smart worksheet. So, the amount on line 4b should be $8,000 , i.e., $10,000 - $2,000. What actually shows up is 0. I can't find any way to override or enter a different amount on 4b.
Your example works fine for me; my line 4b amount is reduced not to zero but to the line 4a amount less the QCD.
So, two questions:
1. Are you using the Online software or the desktop software?
2. Do you see the letters "QCD" to the left of line 4b?
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Form 1040-Sr the QCD prints about 4b, the last two years it printed below the line for 4b and am now still after six months dealing with the irs because they didn't see the qcd. I assume it will get resolved, but am not looking forward to dealing with the irs more. Thanks
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