RMD (private placement)
Hi again,
The outside the box questions keep coming
FACTS:
T-IRA account owner, > 70 1/2, subject to RMDs has 100% of his assets in a private placement
His private placement had a value of “X” a/o 12/31/2014 – more than enough to satisfy his 2014 RMD
His private placement is now worthless ($0 value) – hence his 2014 can’t be satisfied.
Account owner has no other IRAs
Questions
How is the RMD satisfied?
How is this situation reported to the IRS?
What else am I overlooking?
Thank you!
Permalink Submitted by Alan - IRA critic on Mon, 2014-08-11 02:53
RMD cannot be satisfied, but as long as the entire RMD value is distributed leaving a -0- balance, there will be no penalty. Report to IRS with explanatory statement with return including copy of year end account statement showing 0 balance. Account owner should look elsewhere for investment advice if he had no diversification and everything is high risk assets.