review of RMD rules for non-inherited IRA’s

Submitted by Jeff leary on Fri, 2023-12-22 23:11

Ed and/or staff- can you post the rules for an individual that turned 70 1/2 in 2018 and the and whether any penalty waivers would apply (like there are for inherited accounts) and the COVID-19 rules that suspended RMD payments altogether.

Thanks



Submitted by Alan - IRA critic on Fri, 2023-12-22 23:31

  • 2018 RMD required to be distributed no later than 4/1/2019.
  • 2019 RMD due by 12/31/2019
  • 2020 RMD waived by the CARES Act. If taken nonetheless, Notice 2021-51 permitted repayment to the IRA by 8/31/2020.
  • For other than the 2020 year, once a late RMD is distributed the IRS has been waiving the 50% penalty by filing Form 5329 and indicating a “reasonable cause” for the delinquency.
  • Sec 302 of Secure 2.0 reduces the 50% penalty to 25% effective 2023, and to 10% if corrected in a timely manner, but full waiver by filing Form 5329 is still available.

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