failure to take rmd
Someone failed to take an rmd in 2019 in previous advice I learned that you can file a form 5329 and request on form 5329 a reasonable cause exception on line 55 for the additional tax and then show the calculations of the rmd and indicate advisor error for failing to take the proper rmd. Is this advice correct? Is this form filed with the 1040 or separately.
Permalink Submitted by Alan - IRA critic on Thu, 2020-03-05 02:27
It should be filed with the 1040 if the RMD shortfall is detected and made up by the time the current year return is filed. It can also be filed by itself if these other things do not get completed by the time the current year return is being filed. For the explanation of “reasonable cause” for the shortfall, it is not necessary to go into detail or show the calculation. Indicating “advisor failed to alert me about the RMD” or “advisor miscalculated the RMD” or similar will suffice. The 5329 itself shows the RMD and the shortfall. While only 4 lines on the 5329 need be completed, a couple of them are not intuitive, so the last page of the 5329 Inst. should be read to explain what goes on each of the 4 lines.