RMD Check to Deceased
Husband passed away in Aug. 2014. Custodian automatically sent RMD check in deceased name in December. Widow/administrator, over 70 1/2 (who had broken her hip shortly after husband’s death, recovering all season) did not relist annuity IRA in her name until Jan. 2015. 1099-R form reflects 2014 distribution was made under husband’s SSN. As it stands now, is uncashed check part of estate? Should administrator return check and have one reissued in widow’s name for the amount of the distribution (with risk of penalty)? What is the best course of action?
Permalink Submitted by Alan - IRA critic on Tue, 2015-03-17 15:35
The check should be re issued to the surviving spouse beneficiary and will be taxable in 2015. IRS will waive the penalty as this is a valid reasonable cause for the late RMD. Form 5329 should be submitted with beneficiary’s 2014 return to request the penalty waiver.