My mother died in 2023. I got a distribution from her IRA. I entered the 1099-R into Turbo Tax and it's asking about the RMD since she was over 73. What do I do?

Forum|Forum|1 year ago
February 8, 2025
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MAK70

You will have to determine if the RMD requirement was fulfilled or you may be subject to a penalty. You can contact the plan administrator to find the RMD amount. If there was more than one beneficiary or there was more than one retirement account, you may have to do additional calculations. See Retirement topics – Beneficiary

I am sorry for your loss.

bean-maryAuthor

Thank you

dmertz

Employee

Because the IRS waived the penalty for failure to take such a beneficiary RMD for 2024 under the 10-year rule, you can simply say that no RMD was required. Doing so will prevent TurboTax from inappropriately preparing Form 5329 Part IX.

fanfare

Employee

When you are subject to the 10-year liquidation rule for newly inherited IRAs,
to spread the tax impact most evenly over the ten years, and regardless of the Year-End Value,
your divisor should be :10,9,8 . . . 2, 1
OR, 11 - N where N is the number of the distribution year. (Beneficiary RMDs start in the year after the year of death)

If the owner died in 2020, the beneficiary would have to fully distribute the plan by December 31, 2030. which is the tenth distribution year.
the portion to distribute is 1 / 1 or 100%.

In the eighth year you would take out one third of the IRA, there being three years to go.
If you are a young beneficiary, or even not so young, this rule would generate much larger distributions than the RMD based on Pub590B formulas.

At a very great age, the Pub590B formula will overtake this calculation and require a larger RMD in the beginning.

NOTE: if this approach triggers IRMAA right away that would otherwise not happen, you may want a different approach.