Failed to take RMD
Due to a missunderstanding regarding the mechanics of taking the RMD from my self directed IRA, I failed to get it done in 2011 and didn’t discover it had not happened until doing my income tax. Since I now know I did not take the RMD in 2011, I will submit form 5329 for 2011 along with my 2011 tax return and ask for waiver of the penalty. My question is: When should I take the distribution now? Can I leave it in the IRA until I take the 2012 distribution, or should I take it right away?
Permalink Submitted by Alan Spross on Tue, 2012-04-03 00:24
You are supposed to take the delinquent RMD out as soon as you discover it. That improves your chances for the penalty waiver since the IRS expects that when you request the waiver on Form 5329 that you have already made up the missing RMD. Your explanation of “reasonable cause” should include that you have taken out this amount, state the amount and date received. The 2012 RMD can wait until 12/31 if you wish.