Turbo Tax is forcing Military Retirement Pay as a Qualified Plan and penalizing for RMD

Forum|Forum|1 year ago
March 9, 2025
5 replies
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Turbo Tax is forcing Military Retirement Pay as a Qualified Plan and penalizing us for the RMD for which they are not required. Selected Non Qualified and it still is doing this because of age I suspect. There are no other options to fix it. Already deleted and reentered. Everything is selected correct. After entering the info and the nonqualified it takes us to a screen where we HAVE to select either 403b or qualfied plan to progress. HELP! There must be an error in the software!!

DoninGA

Employee

What code is in box 7? Are you under the age of 59 1/2?

slflashyAuthor

Distribution Code is 7. Age is 78. NEVER had this ever happen in past years.

carmarhamm

I am having the same issue. The Turbo tax on-line version must have a program error that needs to be fixed. I, too, have never had this problem in the past when using Turbo Tax. Why now? This coding error has the potential to impact all military retirees who use Turbo Tax. A work around that makes a person falsely answer a tax question is not a permanent, nor acceptable solution. The coding problem needs to be addressed now.

tkpotter

I experienced this also, but with a twist. I'm completing a return for my deceased father. I had all information entered last week, resulting in a refund of all his taxes paid. I went in today to correct a slight error in the income tax withheld and all of a sudden he owes a very large penalty. I did not change any other numbers. I agree that something in the programming may have changed over the weekend. Even if I indicate the entire distribution applies to RMD, it still calculates the penalty. I have to change the RMD due by December 31, 2024, to zero in order to have the program calculate correctly. I did not have to do that last week.

tkpotter

I tried another method--I chose Qualified Plan instead of Non-Qualified and answered the remaining questions appropriately and it didn't apply the penalty. The key to the problem, it seems, is when appropriately choosing the Non-Qualified Plan option and then having to answer the question, Was This Distribution From a 403(b) Plan? You have no choice but to choose No, it's another type of qualified retirement plan, even though you've already said it was Non-Qualified. Any way you answer the remaining questions after that result in a penalty unless you answer "0" for RMD amount due by December 31, 2024.

cbljsteers

I just used your ???? and it worked. The errors disappeared and I was able to send efile.

Obviously the coders for this section were not retired military or they wouldn't have coded it this way.

rlt101

very disappointed in the program this year. have you heard of a fix to this issue?

carmarhamm

Still waiting on a reply. Does anyone know how to officially report this to the coders at Turbo Tax and not to the folks at Turbo Tax live? Before posting my concern, I used Turbo Tax Live help. Talked to one "expert" with 25 yrs experience. He was totally convinced Military Retirement was a qualified plan, which it is not. Talked to two others several days later. One cut me off and the other said it was beyond her expertise. None were willing to report this up the chain to get a resolution. This coding error impacts other types of non-qualified plans, not just military retirement. Hope they get this fixed soon.

Alyce54

Same problem. Is TurboTax making any efforts to solve this problem?

carmarhamm

Just received an email from Turbo Tax. It reads:

"Dear TurboTax customer,
Thank you for being patient while we investigate your issue.
We’re still working on a solution and we’ll send you an email once a fix is in place.
Thank you for being a TurboTax customer.
Sincerely,
TurboTax"

Nice to know someone is monitoring this forum and is working the problem. Hope they implement a fix ASAP.

Alyce54

I have reason this forum it is a glitch, I have paid for electronic filing and now it seem you carmaker it happen I will definitely be seeking a full refund if the matter is not fixed soon. I know one person sat on phone and got their forms transmitted BUT had to pay fee for help m. We should not be paying to repair a glitch! Your fault you pay.!