Missed RMD from inherited IRA
Hello,
I have a client who inherited approximately $25k several years ago and has been diligently taking RMDs from the inherited IRA. However, we just learned that for 2018, she missed her RMD. She still desires to continue stretching the IRA if possible. Therefore, there are two considerations: 1) How do we handle the 50% penalty? 2) Can we make up the missed RMD and continue to stretch the IRA.
Any advice would be appreciated.
Thank you,
Anthony
Permalink Submitted by Alan - IRA critic on Wed, 2019-07-03 22:48
She must first distribute the missed RMD for 2018. Then she can file Form 5329 requesting that the penalty be waived for “reasonable cause.” The IRS almost always grants the waiver. Of course, she will be taxed for two RMDs in 2019, but can continue the stretch.
Permalink Submitted by Anthony Saccaro on Thu, 2019-07-04 03:29
Thank you!!