RMD on pension

Forum|Forum|1 year ago
February 19, 2025
3 replies
0 views

Why is Turbo Tax 2024 asking me to calculate the RMD on my pension to make sure I've taken enough? I've never had to do that before - my monthly pension disbursement already has the RMD calculated. I have no idea what to base the calculation on!

VolvoGirl

Employee

Say all of it is the RMD. If you need to start taking the RMD it will ask you if it is the RMD. Say yes. Anything your pension pays you is considered to be the RMD. Traditional pensions automatically fulfill the rules of an RMD. So for the RMD question put in the same amount as box 1.

DoninGA

Employee

If you land on a screen where is asks to enter the Required Minimum Distribution Amount in a box, just enter the total distribution received in 2024 as shown on your Form 1099-R in box 1.

Usaaguy

If a pension plan pays you monthly then the RMD is already calculated in that payment by the plan administrator...they just don't separate it out for you. So how can Turbotax expect you to know? In turbotax for tax year 2024, you are asked what amount of your pension is for the RMD, and you must enter some data point. The answers I have seen here are to put in the amount in box 1.....I am not an expert but this is wrong. You will be taxed on whatever amount you put in there. So if you put in the amount in box 1 of your 1099R you will see your tax jump up dramatically. I decided to enter "0" to get me past the issue since that info is only for turbotax and appears nowhere on the return. AS I figure it, since you are taxed on your pension anyway, the "0" is not defrauding anyone! I have attempted to find the info from the Pension Plan Administrator but have been unsuccessful.

DoninGA

Employee

@Usaaguy I have been receiving a pension for the past 21 years. When I turned 70 1/2 I reported all of my annual pension as a RMD from tax year 2019 onward. There is no additional tax by claiming an RMD. The amount from box 2a on the Form 1099-R is entered on your federal tax return, Form 1040 line 5b as ordinary income.

Any federal income taxes withheld and reported in box 4 of the 1099-R flows to the Form 1040 Line 25b

Usaaguy

Yes, you are correct but in the 2024 version of turbotax, when you enter an amount higher than zero the software adds tax for that amount. You can see it run up the numbers as you do it. You are correc t that it should not increase the taxes and if you were to do it by hand, the taxes would not increase because the IRS doesn't care. But in this year's application when you enter the data, the software adds the tax. I had not seen this in previous applications.