Yes, this is exactly what I would expect it to do - if the IRA were taxable and not routing through the 8606.  They took one amount for their RMD.  $70k. The 1099R is correct at the $70k as otherwise the RMD would be too low by the $10k.  IF there was no 8606, $70k would be on 4a and $60k would be on 4b.  Lacerte adjusts for the $10k not being taxable (as the 1099R does not reflect this).  No worries all $10k went direct to the charities and meets all those requirements to be a QCD.  SOOO, I would think that when it calcs the 8606 - it would reduce - AND I found my error.  I did not have an amount for the FMV of all IRAS input.  I need the 5498 from the client.  SO it was not calcing.  For giggles I put in $1m - and now it reduces.  Ugh!  Are we done yet this year?