Missed RMD
I have a profit sharing plan. I did not take my RMD for 2022.
Working to process the missed RMD in 2022 and the RMD for 2023.
Is the missed RMD still processed as a RMD subject to 10% withholding? Or is it a distribution post 59.5 that would be subject to 20% withholding?
Should taxes be withheld from the missed RMD?
I’m trying to fill out the withdrawal form provided by the custodian and the only options for reason for withdrawal for the missing RMD that seem to make sense is older than 59.5 or RMD. But not sure how it will look selecting RMD for both withdrawals but different RMD amounts.
Thanks!
Permalink Submitted by Alan - IRA critic on Wed, 2023-11-01 18:27
The default withholding rate is 10%, but withholding can be declined if desired. The 20% mandatory rate only applies to eligible rollover distributions and an RMD is never eligible for rollover. The RMD box should be checked and that will eliminate the 20% mandatory rate. However, since the 2022 RMD is late, a 2022 Form 5329 will have to be filed to request waiver of the 50% excise tax that applied in 2022.