Reporting 2020 RMD rollovers

[Dodgerfan]

I have a client who returned the full gross amount of his 2020 RMD prior to the 8/31/20 deadline. He received a 2020 1099R showing the RMD and that it was fully taxable. It was a normal distribution - Code 7. How do I report this on Lacerte? Do I report the full amount of the RMD with $0 taxable and use code 7 and code G for the rollover even though the 1099R shows the RMD as taxable or do I show the RMD amount,  $0 taxable and use code G for the rollover?

[qbteachmt · Accepted solution]

"even though the 1099R shows the RMD as taxable"

Because it was, according to the issuing party, because they don't know what the taxpayer will be doing with the money that might result in some exclusion.

That part is not the issue. The issue is that RMDs normally are not qualified for rollover, but this one time, it qualifies. You have a regular rollover. That's the special provision.

[Dodgerfan]

The question was how do I enter the information on the 1099R received. Do I enter the gross amount of the RMD and show that none of it is taxable? Do I use Code G showing that the amount was a Rollover?

[qbteachmt]

Here is the help article:

https://proconnect.intuit.com/community/individual/help/individual-form-1099-r-frequently-asked-ques...

Yes, you enter the Gross. Enter the data from the 1099-R exactly as it is reported on the 1099-R. It's not the 1099-R that you modify. You will be indicating what the taxpayer did with it.