Missed withdrawal of Mandatory Required Minimum Distribution prior to end of year due to illness. How do I avoid the 50% tax ?

Submitted by Tom Corrado on Wed, 2023-01-18 16:34

Attn: Glenda – Missed the withdrawal of RMD due to illness. What can I do to avoid the 50% tax penalty ??



Submitted by Alan - IRA critic on Wed, 2023-01-18 17:57

  • The late RMD must be made up and then Form 5329 for the year of the missed RMD filed to request the penalty waiver for reasonable cause. Care should be taken to complete the 5329 correctly per the 5329 Inst because proper completion of the 4 lines is not intuitive.
  • The missed RMD distribution and the current year RMD will both be taxable in the year distributed.

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