Missed 4/1/2014 deadline for first RMD. What to do now?
Mistakenly, the taxpayer thought he could delay RMD’s from his IRA because he is still working.
Besides immediately taking the missed RMD:
1) What paperwork needs to be filed (for tax year 2013 and/or 2014)?
2) When does it need to be filed? (i.e. now, or next tax filing)
Permalink Submitted by Alan - IRA critic on Sat, 2014-05-31 21:53
Taxpayer should file Form 5329 with a 1040X for 2013 and request a waiver of the penalty for reasonable cause. The 2013 RMD should be withdrawn now in the exact amount. Make a copy of the distribution statement and include it with the 5329. Indicate that the missed RMD was taken as soon as TP realized that the still working exception did not apply to IRA accounts. Then take the 2014 RMD as usual before year end. Both distributions will be taxable on the 2014 return.
Permalink Submitted by mk foss on Tue, 2014-06-03 22:08
Actually the Form 5329 and the penalty waiver request would go with the 2014 return because 4/1/2014 was the actual due date for the payment. It’s much easier to handle these with an originally filed return. IRS has been very good about waiving the penalties but they cannot do so unless the missed amount is withdrawn before the waiver is requested.