missed rmd
I have a client that through an oversight missed taking about $4,800 of his required RMD of $135,000. He is submitting a letter of explanation and the form 5329. My question is, in your opinion, is the IRS pretty lenient in waiving the penalty in a case where it clearly was not the taxpayers fault that the RMD was missed?
Also, second question, are advisory fees on an IRA account an allowable misc. deduction?
Permalink Submitted by Alan - IRA critic on Thu, 2017-02-23 00:44
The IRS is fairly lenient with all taxpayer reported make up distributions with a proper 5329 filed indicating reasonable cause for the error. Even if the cause is simply taxpayer error, they usually waive the penalty but sounds like client may have a more valid reason. Advisory fees are a misc deduction subject to 2% AGI floor if paid with outside money and not deducted directly from the IRA.