Question

RMD distribution request made 12-29-23 after markets closed.

Forum|Forum|2 years ago
April 10, 2024
1 reply
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I did an on-line transaction with Vanguard requesting my full 2023 required RMD distribution on 12-29-23 but not until after the markets had closed that day, So, the transaction didn't get posted until 1-2-24. Obviously, I didn't receive a 1099-R. I called financial institution and they told me I would need to file an IRS 5329 and explain the situation and everything should be OK because this happens all the time. Here are my questions: If I complete my TurboTax 2023 federal return (I use the on-line version) and show the amount of my 2023 required RMD distribution but have no 1099, TurboTax treats it like it is a missed distribution and calculates a large sum of taxes due (and probably penalty?) on line 37 "amount you owe" and I have already had federal taxes withheld from that distribution. Do you think it would be better to tell TurboTax there was no required RMD distribution in 2023 and just mail my return to the IRS with the form 5329 attached? I don't want to write a big check to the IRS and sit around and wait for them to take action on my 5329 form. I read everything on you Help page regarding missed RMD distributions but I couldn't find an answer to exactly this question. Please tell me what my options are.

D

DanaB27

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.

If you do not have a Form 1099-R to file this can only be done using the "forms" mode which is only available with the TurboTax Desktop software:

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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