This does not result in a problem, but the daughter’s must take out the mother’s RMD this year if possible. They can split it between the two of them in any portion they wish. While they should distribute it this year if possible, if they don’t get it done until next year, they can usually get the penalty waived by filing a 5329 and requesting the penalty be excused for reasonable cause.

Even though this is mother’s RMD, it will be reported and taxed to the beneficiaries that receive it. It does not go on mother’s final return OR on the estate income tax return.

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