2023 missed RMD - How to file 5329 in Turbotax?

Forum|Forum|2 years ago
February 28, 2024
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In 2023 I missed to take 2023 RMD. How to report in Turbotax? Where to find form 5329?

MinhT1

Please follow the instructions in the answer by Tax Expert @DanaB27.

[Edited 3/17/24 | 1:55 PM]

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buena7Author

In Turbotax online it only shows search results. No form link. Can I obtain Form 5329 in Turbotax online?

DanaB27

If you have a Form 1099-R entered then you can use the steps below:

Click on "Search" on the top right and type “1099-R”
Click on “Jump to 1099-R”
Click "Continue" and enter the information from your 1099-R
On the "Your 1099-R Entries" screen click "Continue"
Continue until "Tell us more about the retirement plan distribution" screen and select "I did not receive all the RMD for 2023" and click "Continue"
On the "Required Minimum Distribution" screen enter the RMD amount and actual amount received
Enter information on the "Let's see if we can reduce your tax bill" if you want to apply for a waiver.

If using the TurboTax Online version and have no 2023 Form 1099-R to file, you will have to prepare the 5329 manually.

Download Form 5329 from the IRS website and fill it out the same as above. Print and mail your return with the 5329 form and explanation attached as described in the 5329 instructions. The 2023 Form 5329 must be attached to your printed and mailed 2023 tax return and cannot be e-filed.

Please be aware that you can only use this method if you are requesting a waiver of the penalty and there is no taxable amount on Form 5329 form line 55 that must be transferred to Schedule 2 line 8.

Please see Relief for Reasonable Cause for additional information.

Or you can use "forms" mode which is only available with the TurboTax Desktop software if you do not have a Form 1099-R to file:

Enter the forms mode and click on "Open Form" and type "5329".
Scroll down to Part IX line 52 and enter the RMD amount that should have been taken. On line 53 enter the amount of the RMD that was actually taken (probably zero if it was missed).
Then in the box right under line 53 "Waiver of Tax Smart Worksheet" enter the same amount as line 52 (the RMD amount).
Click the "Explanation" button and enter the reason for missing the RMD and your statement requesting a waiver.

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12099

how do I get form 5329

LindaS5247

@12099 Please clarify your question by adding some additional information so we can provide a more helpful answer. Did you receive a Form 1099-R? If so, have you entered it? What version of TurboTax are you using?

Please feel free to come back to TurboTax Community with additional information or questions or click here for help in contacting Turbo Tax Support

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ricg1

If you missed taking an RMD in 2023 you should be able to file form 5329 and a letter of waiver that may allow you to avoid the penalty, if the IRS accepts your reason. But you will need to have received the RMD ( excess accumulation ) in 2024 which the IRS refers to as the correction window.

If those all apply you can follow the IRS instructions listed under Part IX of "instructions for form 5329".

But you will not be able to do this using turbo tax. TT requires that you have a 1099-R which of course in this case there is none. That because your RMD was paid out in 2024 instead of 2023.

Using forms in TT you can complete lines 52 and 53 on the 5329 form and TT even auto fills line 54 with the RC notation and the amount. TT also offers a special explanation window where you can enter your reason for having the penalty waived. At this point it appears that all is going well.

However, the trouble begins on line 55 where you need to follow instruction to determine if you qualify for the 10% rate vs. the 25% rate. If the instruction worksheet indicates that you qualify for the 10% rate then you are asked to check a box on line 55 in form 5329. At this point I would expect TT to calculate the amount for line 55, which would be 10% of your excess accumulation. But TT does not calculate your tax or make an entry on line 55. I was able to override and make the entry myself, but then TT complains that it can no longer verify calculations and that I need to remove my entry. This is bad because this amount is propagated to other forms and becomes part of your tax on the 1040 form. I called support and after looking into it the best they could offer was an apology and the bad news that I would not be able to e-file my taxes and would have to snail mail them. Not the end of the world, but also not why I purchased TT, I love e-file.

I hope this helps someone.

kimbo1961

You are right if you call they have no idea of what you are asking and just provide an apology as you say. Also in the step by step method when I answer I have not taken any RMD they come back with a notice in red that says " do not file your tax, come back later we are working on this" The question everybody has and remains unanswered for over 2 years is HOW DO YOU HAVE TURBOTAX INCLUDE THE 5329 FORM AS PART OF THE E FILE DOCS IN YOUR RETURN??????? If you look in the printing tab and as for a copy of all required docs to file it includes the waiver explanation but not the 5329!!!! YOU ARE RIGHT THE ONLY REASON i USE TT IS TO FILE ELCTRONICALLY. I guess this year I will have to file by mail unless TT answers the question and resolves the 5329 form exclusion problem. As it stands now 2/16/25

Turbotax 2024 CAN'T HANDLE A MISSED IRA RMD WITHDRAWAL . It will not trigger a form 5329 to request a penalty waiver if you indicate a $0 withdrawal for your RMD. If you prepare the form 5329 yourself it will not include it in your required docs to be filed E or mailed. It keeps telling me to file later because they are working on this problem, as if this was rare. According to published data from IRS every year there is around 28% of filers that have a shortfall in their RMD's and need to file form 5329 to report it. WHAT HAS TURBOTAX BEING DOING ALL THESE YEARS?????? Its a very simple problem to solve just add a trigger to the software for this form whenever hey
they see a shortfall in the step by step questions! Meanwhile I can't file my tax return with E file because they will not support this form so the only thing I can do is print the 1040 with docs supported and then print the 5329 separately and mail both together to the IRS. Be careful with answers online which says it will file the 5329 unless they are telling you how and you have tested. Most of the time they don't answer the question if it can be filed but instead explain how you can prepare yourself the form if you have the desktop form of the software which is not the question! I wonder if people who answer to questions or complaints EVER RED THE ACTUAL QUESTION.

tkirrane

need form 5329

where is it?