Another Missed RMD Question
Husband died Jan 2012, did not take his 2012 RMD; spouse then rolled-over deceased spouse’s entire account balance into a new IRA in her name.
Questions: 1)Can she take his missed RMD for 2012 out of her account to satisfy IRS?
2)When filing form 5329, does spouse pay the 50% penalty or since writing “RC” on line 52, does she not pay and wait for waiver (written explanation included with 5239)
3)Spouse turns 70.5 May 2012 but did not have any IRA account prior to establishing this with the proceeds from her deceased spouses account. Am I correct that she will not have to take an RMD until 2013 since she did
not have an IRA with a 12/31/2011 account balance?
4) I assume a final joint return is filed for 2012?
Thank you
Permalink Submitted by Alan Spross on Mon, 2012-03-26 20:11
1) Yes, in fact she must. We are assuming here that he passed on or after his RBD (if he passed prior, there is no 2012 RMD).
2) There is no need for a 5329 or a penalty since she will be taking his 2012 RMD, not his 2011 RMD. And she will be taking it prior to the end of 2012.
3) Correct. In 2012 she only needs to take her husband’s 2012 RMD.
4) There are other options to a joint return, but a joint return in this situation is usually the best option.
Permalink Submitted by Henry Kramarski on Mon, 2012-03-26 20:21
Thanks for the quick post reply alan-oniras.
Again regarding the 5329, if she takes the missed RMD payment from her account, the 1099R will be issued in her tax ID and not the deceased husband. Won’t that cause a problem or will the IRS automatically reconcile the amount based upon other information received form the 5498?
Thank you.
Permalink Submitted by Alan Spross on Mon, 2012-03-26 21:43
The 1099R will not cause a problem being issued to her because she is the one responsible for the RMD. Her husband’s responsibility for the 2012 RMD is eliminated since he did not live to the end of the year, and the beneficiary(s) becomes responsible under the IRS Regs.
There are two alternatives for Form 5498, but since decedent passed in January and the IRA rolled over shortly thereafter, the IRA custodian will probably issue a 5498 to the decedent showing a year end 2012 value of -0-, and not issue one for the beneficiary.