Catherine Posted July 14, 2011 Report Share Posted July 14, 2011 I have a final return to finish up. Just got confirmation that the one 1099-R I was missing was indeed missing because the taxpayer did NOT take his RMD in 2010. He had a long history of requesting that RMD in December -- but he died in November, before the request was made. I have the RMD for 2010 amount on Line 50 of Form 5329, and the "0" for actual distribution on Line 51. Line 53 is supposed to show the 50% penalty, and the instructions say to pay the penalty and attach the waiver explanation. I have the waiver explanation. But the Line 53 amount is zero, and I can't get it to show the 50% penalty amount without an over-ride. Anyone have an explanation or ideas for me? Should I over-ride Line 53 (estate gets a refund in either case)? Does the Line 53 penalty get ignored when the 1040 says "Taxpayer Deceased"? TIA & hope all are enjoying the summer, Catherine Quote Link to comment Share on other sites More sharing options...
Catherine Posted July 14, 2011 Author Report Share Posted July 14, 2011 Tried a new search on the "other" forum and someone named Kamman had posted an answer. Here it is in case someone here needs it in future: "Waiver of tax. The IRS can waive part or all of this tax if you can show that any shortfall in the amount of distributions was due to reasonable error and you are taking reasonable steps to remedy the shortfall. If you believe you qualify for this relief, attach a statement of explanation and file Form 5329 as follows. Complete lines 50 and 51 as instructed. Enter “RC” and the amount you want waived in parentheses on the dotted line next to line 52. Subtract this amount from the total shortfall you figured without regard to the waiver, and enter the result on line 52. Complete line 53 as instructed. You must pay any tax due that is reported on line 53. The IRS will review the information you provide and decide whether to grant your request for a waiver." Thanks, Kamman, whoever you are. Quote Link to comment Share on other sites More sharing options...
joanmcq Posted July 14, 2011 Report Share Posted July 14, 2011 The beneficiaries have to take the decedent's final RMD and then they can decide how they want to proceed with their inheritance. Quote Link to comment Share on other sites More sharing options...
Catherine Posted July 14, 2011 Author Report Share Posted July 14, 2011 The beneficiaries have to take the decedent's final RMD and then they can decide how they want to proceed with their inheritance. Well, the paperwork from the IRA custodian was never sent, since no RMD was taken. They (executor/beneficiaries) knew _nothing_ about this account until I questioned where the 1099-R from that IRA was, and they only got a response earlier today. So there was no way to take the distribution in 2010. Quote Link to comment Share on other sites More sharing options...
joanmcq Posted July 15, 2011 Report Share Posted July 15, 2011 Yeah, that can be the case. The point I was trying to make is that the RMD based on the decedent's life needs to be taken out ASAP to correct the error. Then the benes will have the choice as to what to do with the account going forward. Quote Link to comment Share on other sites More sharing options...
Catherine Posted July 15, 2011 Author Report Share Posted July 15, 2011 Yeah, that can be the case. The point I was trying to make is that the RMD based on the decedent's life needs to be taken out ASAP to correct the error. Then the benes will have the choice as to what to do with the account going forward. Thank you; I will make sure the executor knows. Catherine Quote Link to comment Share on other sites More sharing options...
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