How do I correct a return where the taxpayer has failed to take a RMD but, has already filed a return for this year?

Forum|Forum|6 years ago
December 7, 2019
3 replies
36 views

Taxpayer filled out form with financial institution in 2017 for RMD but mistakenly applied for a "one time" withdraw. After return was filed for 2018, he discovered his mistake.

How can this be corrected to hopefully avoid the 50% penalty?

ProSeries Professional

This topic has been closed for replies.

Best answer by abctax55

You report the distribution when received (2019). You don't "fix" 2018 because the distribution was NOT received then.

With 2019, you complete the F 5329 with the appropriate mea culpa. The IRS is usually very forgiving about the penalty, especially when there's proof the error has been corrected (i.e. - the delinquent distribution was taken as soon as the error was noticed.)

abctax55Answer

Level 15

You report the distribution when received (2019). You don't "fix" 2018 because the distribution was NOT received then.

With 2019, you complete the F 5329 with the appropriate mea culpa. The IRS is usually very forgiving about the penalty, especially when there's proof the error has been corrected (i.e. - the delinquent distribution was taken as soon as the error was noticed.)

HumanKind... Be Both

M

Marc-TaxMan

Level 7

noticed by his diligent tax preparer who swoops in to the rescue!

Sign up

Login with SSO

Let's get you signed in

Login with SSO