Missed Inherited IRA RMD for 2021 due to nebulous rule changes. How to handle?

[dmertz]

The request for the waiver of the penalty for taking your share of the 2021 decedent's RMD late must be done on a 2021 Form 5329.  That form can be filed stand-alone since it does not affect the rest of your 2021 tax return.  Include an explanation that you have taken your share of this RMD.

The actual distribution of the late-taken RMD is reportable on your 2022 tax return, the year in which the distribution will have occurred.  This will generally be included in the total on the 2022 Form 1099-R that also includes the 2022 RMD that you will take as beneficiary (assuming that you follow the proposed regulations requiring annual RMDs and actually take this distribution).

It's likely that you'll want to take more than the RMD each year so that you don't end up with a large spike in your taxable income in 2031 when you must take a distribution of whatever remains in the inherited IRA.

See NCperson's post about coordinating with the other beneficiaries to satisfy the year-of-death RMD.

[Bruce-W]

Thank you, dmertz, for the additional information. I think I know how to proceed now as a result. Appreciate you.