How to reverse erroneous Required Minimum Distribution

nedriv49
nedriv49 Member
edited March 12 in Investing (Windows)
I need help on how to properly record a transaction in Quicken.
I am using a current QUICKEN subscription on Windows 10.

BACKGROUND: I have a rollover IRA. I took my 2021 RMD in monthly distributions. State and Federal taxes were withheld each month. The RMD amount net of taxes was transferred to my non-taxable investment account each month. For my 2022 RMD, I plan to continue the monthly distribution.

The transaction for the monthly distribution is recorded in Quicken as a deposit transaction into the non-taxable account with splits for tax withholding.

SITUATION: My RMD amount decreased for 2022. The new monthly amount including Fed and State withholding was entered into the custodian's system but apparently the prior year monthly RMD was not cancelled (very frustrating) and the result was that two distributions for different amounts were processed for January 2022. The erroneous (2021 prior year) amount has been reversed by the custodian and placed back into my IRA account.

QUESTIONS:
(1) How do I enter the reversal transaction into Quicken to include proper accounting of the State and Federal withholding (that is, to REDUCE the 1099-R tax amounts that resulted from the erroneous transaction)?

(2) How do I show the amount transferred back into the IRA as something other than a CONTRIBX type transaction (it's not a contribution)?

Thanks for your help.

EdV

Comments

  • NotACPA
    NotACPA SuperUser ✭✭✭✭
    Why can't you simply delete the erroneous entry and proceed from there?
    Q user since DOS version 5
    Now running Quicken Windows Subscription, Home & Business
    Retired "Certified Information Systems Auditor" & Bank Audit VP
  • Sherlock
    Sherlock SuperUser ✭✭✭✭✭
    1. Assign the appropriate tax line item to the entry in the split transaction that transfers the distribution back to the IRA: select the split entry, Edit > Tax line item assignments1099-R:Total IRA taxable distrib. in the Tax item: pull-down menu, and OK.
    2. Initiate the transaction from the IRA account as a Deposit: open the IRA account, press Ctrl + N, select Deposit in the Enter transaction: pull-down menu, specify the source account as the category.  In the destination register, select the transfer transaction and press Ctrl + S and enter the remaining split entries, etc.
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