dmertz
Level 15

Retirement tax questions

When you said that you inherited the IRA in 2007, I assume that your father died in 2007.

 

With 15 years of missed RMDs (RMDs were waived for 2009 and 2020), I'm going to decline to comment on what should be done.  What could be done is take a distribution equal to the combined amount of all of the missed RMDs determined as Opus 17 described (which requires knowing the 2007 through 2023 year-end balances), then filing 2008, 2010 through 2019 and 2021 through 2024 Forms 5329 requesting waivers of the penalties.  Although the IRS commonly grants the waivers, there is no guarantee that the IRS would do so.  If they don't, the penalties could total close to half of the late-taken amount.  Depending on your age in 2008 and using (for simplicity) a constant 8.5% growth rate, the missed RMDs plus your 2025 RMD would probably total anywhere from around $72k (if you were age 40 in 2008) to the entire balance (if you were age 65 in 2008).

 

(Since it's required by law to provide you with the year-end balances, it's highly doubtful that Fidelity did not provide you with year-end statements or Forms 5498 showing the year-end balances.  Year-end statements going back to 2015 are available from Fidelity online.)