RMD in year of death

Submitted by Joseph Hock on Sat, 2019-01-12 14:16

In order for an after-death estate to avoid an IRS penalty, in the year of one’s death – and regardless of the length of time he/she lives during that year – at the time of his/her death, must the ENTIRE RMD for the year have been taken? If so, are there any provisions allowing the estate executor to take certain measures to escape such penalty? – such as, reporting the entire RMD on the decedent’s final income tax return. Are there any other relevant matters, measures, etc. of which I and my executor should be aware?



Submitted by Joseph Hock on Sat, 2019-01-12 14:22

This question  is of much importance to me – and assume so to several others.

Submitted by Joseph Hock on Sat, 2019-01-12 14:24

no additional comment

Submitted by Joseph Hock on Sat, 2019-01-12 14:25

no additional comment

Submitted by Joseph Hock on Sat, 2019-01-12 14:27

Hope for response as promptly as possible.  Thank you.

Submitted by Alan - IRA critic on Sat, 2019-01-12 15:50

  • If the estate is the IRA beneficiary, either the executor can take no distributions and assign the inherited IRA to the estate beneficiaries, who then make up the year of death RMD – or if the executor wants to request a distribution of that late RMD to the estate, they can then pass through the distribution to the estate beneficiaries on a K 1.  Regardless, whoever makes up the late year of death RMD, the estate should file Form 5329 for the year of death requesting that the penalty be waived for “reasonable cause”. See the last page of the IRS Form 5329 Instructions.
  • Since it take time to determine the full RMD and if the decedent completed the RMD or not (from the estate IRA or ANY OTHER IRA they owned that might not have gone to the estate), the IRS will almost always grant the penalty waiver as long as the 5329 is completed correctly and the RMD has been made up by the time the 5329 is filed.
  • The RMD does NOT get reported on the decedent’s final return unless the decedent received it before passing. The IRA custodian will issue a 1099R to the recipient of the late RMD, whether the recipient is the estate OR the estate beneficiary direct. That RMD is reported on the tax return of the recipient consistent with the 1099R.

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