My father passed late in the year and his IRA RMD was not taken. The transfer of the IRA to me was not completed until January of this year. I had no access to the funds in 2023, but I took the RMD distribution as soon as I had access to the funds in January of this year. I did not receive a 1099 for this distribution. I assume that it will be sent next year for my 2024 taxes.
Do I report the late distribution on my 2023 taxes or report it on my 2024 taxes?
Do I need to file the 5329 form to explain the late distribution in 2023 or send it with the 2024 taxes?
Thank you for your help.
IRS Notice 2023-54 provides that certain non-spouse beneficiaries subject to the 10-year distribution rule will not fail the RMD requirements because they didn't make distributions in 2023.
You need to report the distribution on your 2024 return. You should receive a 1099-R in 2024 which will generate form 5329 with your 2024 return.
Check, Form 5329 Instructions to include the penalty waiver if you have any penalty assessed in 2024.
[Edited 03/28/2024, 12:30PM PST]
The new regulations proposed by the IRS now provide an automatic waiver of the excess-accumulation penalty under these circumstances, so there is no need to report anything on your 2023 tax return about the late-taken 2023 year-of-death RMD, no Form 5329 required. If TurboTax asks, indicate that no RMD was required. this will prevent TurboTax from needlessly preparing Form 5329 Part IX.
This distribution taken in 2024 will be reported on your 2024 tax return.
Thank you for your response. There appears to be a difference of opinion here so I would welcome any additional thoughts. Thank you for your help.
Thank you for your response. I intend to take a second distribution in 2024; would there be any issue in turbo tax for taking two distributions in 2024?
If you missed an RMD in 2023, but took it instead in 2024,
on Form 5329 you request a waiver of penalty, which will be granted.
Filing or not filing 5329 will not impact your tax one way or the other, unless you omit the waiver request.
For 2024, both amounts are to be included on 1040 Line 4b.
There is nothing special about receiving more than one distribution from this account. All distributions from this account received in 2024 will be totaled on a single 2024 Form 1099-R.