1099-R Code Y

[jerry]

The IRS has introduced a distribution Code Y to indicate a QCD (and then in October made it non-mandatory, but still available).

Nevertheless, I don't see it in the Screen 13.1 dropdown for box 7.  

Does anyone know if Lacerte plans to add this?  And will it be a primary code (like Y) or secondary code (like 7Y)?

[PhoebeRoberts · Accepted solution]

Lacerte doesn't have any of the new law stuff programmed in yet.

IRS instructions (https://www.irs.gov/instructions/i1099r#en_US_2025_publink1000147723) say:

To report a QCD use code Y with:

• Code 7 for a QCD from a non-inherited (normal distribution) IRA,

• Code 4 for a QCD from an inherited (death distribution) IRA, or

• Code K for a QCD reporting distributions of traditional IRA assets not having a readily available FMV that are either from non-inherited or inherited IRAs.

[Caroleamst]

I just noticed that the question about code Y for QCD was asked in December.  It's February and Lacerte still hasn't added that designation to the program.  I have a specific 1099 with Y on it.  When I do get it in--I get a critical diagnostic which says the return can't be efiled.

I wouldn't think that this would be hard to add to the program!!

[IntuitKatie]

@Caroleamst Thank you bringing this to our attention! I have passed this along and development is taking a look. Thanks!

[jfindley]

Thank you, I have the same issue, cannot add code Y for charitable contribution from an IRA

[Caroleamst]

Can't efile with a code Y.

[IRonMaN]

I am just thinking out loud here, but I wonder if Phoebe's suggestion might actually help with the issue.  🤔

[IntuitKatie]

Hello @Caroleamst and @jfindley 
Can you confirm this has been addressed in the most recent update? Thanks!

[tvogelsang]

I have just entered a 1099R with Code Y and 7 and I am receiving a diagnostic in Lacerte saying if the 1099R has both those codes then the issuing institution may need to be contacted.  From everything I've read, this diagnostic appears to be incorrect, but I can't get it to go away.

[PhoebeRoberts]

Enter it just as Code Y if you want to make the diagnostic go away.