taxpayer is 79, has not drawn RMD. Does he go back and revise all years of returns or just start now.

Forum|Forum|2 years ago
November 10, 2023
2 replies
26 views

Taxpayer has bot drawn any of his RMD from IRA account. He is 79 years old. how do we correct this.

Do we go back and revise all of his returns back to when he should have been drawing? Do we just

withdraw this year. How do we calculate penalty. This is not a traditional IRA. This is Gold.

ProSeries Professional

This topic has been closed for replies.

abctax55

Level 15

Your client has to withdraw all the prior missed RMD's now, and don't forget the one for 2023 (that can wait until 12.31.23).

If your client is charitably inclined, this might be the time to do a large charitable contribution directly from the withdrawal(s)

ALL the amounts will be reported on one F 1099-R for the year 2023.

F 5329 will need to be completed (maybe one for each year? I'd have to read the instructions...) The F 5329 can be filed separately from the F 1040

My experience is to NOT compute the penalty; write up long *sob* story explaining why the RMD's were missed and what has been done to make sure they won't be missed in the future. It's much easier to get someone at the IRS to forgive than it is to find someone to refund the penalty paid.

By "gold", you mean the retirement assets are actually/physically gold bars/bullion/coins???

HumanKind... Be Both

BobKamman

Level 15

Don't waste your time on a long sob story when a short one will do. It's going to be read by an IRS clerk who gets evaluated on production, not empathy.

The law probably requires a 5329 for each year, but I doubt IRS will ask for or expect them. Just get in compliance for now. Has the taxpayer been filing 1040s? Maybe file a separate 5329 for 2022 and mention that the failure spans multiple years.

I don't know what a Gold IRA is, either. Gold can be held in a traditional IRA, just not with a typical trustee.

M

momma1Author

Level 4

Thank you, Should I file a 5329 for 2022 when the founds will not be drawn until 2023 and the 1099R will be issued for 2023? I only know what the IRA Value was from 2019 forward and they have reported the same IRA total every year since then. The taxpayer has dementia, and his wife and son are trying to get Complient. Should I calculate from the reported amount for all years back to 2016?

I appreciate you help. This is a mess

PATAX

Level 12

My experience is with adequate explanation, the first time they waive penalty. Not sure though about multiple years.

Sign up

Login with SSO

Let's get you signed in

Login with SSO