Missed RMD but reported on correct 1040

[EA21440]

Hello.  My husband was ill in 2023 and he missed withdrawing his RMD from two different IRA accounts. However, when I did the taxes in March 2024, I discovered that he didn't take his 2 RMDs.  He called the 2 IRA custodians and they sent him his 2 RMD's in March 2024.  Even though I did not have a 1099-R for either of these withdrawals, I still was able to report them on time on our 1040 for the tax year 2023. 

(My husband died right after April 15th of 2024. )

The problem is that the 2 custodians just sent me a 1099 for the tax year 2024 for each of these RMD's which were already reported on the 2023 1040.  We also filed form 5329 in March 2024 asking for a waiver of penalty due to his ill health.  How do I explain to the IRS when doing the 2024 taxes that these 2 RMD's were already reported on the 2023 1040?  I fear that the IRS will see the 2024   1099's I received in for these 2 RMDs and expect me to report them on the 2024  1040 even though I already reported them on the 2023 1040? Do I have to enclose a letter explaining this when I send in my 2024 1040 form?
I would appreciate someone's help.  Thanks.

[dmertz]

Because the amounts were distributed in 2024, they were not to be reported as income on the 2023 tax return.  You must amend the 2023 tax return to remove that income so that it will only be taxed on the 2024 tax return (as it should be).  Because you already filed the 2023 Form 5329 requesting waiver of the excess-accumulation penalty, you won't need to include that in your amendment.

[EA21440]

I called the IRS and they advised me to report the missed RMD withdrawals (supposed to be withdrawn in 2023 and not withdrawn until 2024) right away on my 1040 2023 tax  form even though the 2024 1099-R was not generated yet. This is not the advice you gave me.  You are asking me to amend the 2023 tax form and remove any RMD amounts that were properly reported for the tax year 2023 and then put them on the 2024 1040 because the 2024 1099-R shows those amounts. I thought if I explain this in writing when I do my 2024 1040, the IRS will see that all income has been reported.  I can explain in detail how a portion of the total RMD on the 2024 1099-R  was reported on the 2023 1040 and a portion of that total was reported on the 2024 1040.  Both RMD amounts total the RMD amount on the 2024 1099-R.  Please advise.

[fanfare]

It is not enough to report the amounts; they must be reported on the Form 1040 for the applicable year.

Ordinarilly, IRS won't correct your errors based on a written note, which is often discarded.

Use Form 1040-X  with "2023" notation to add or correct information on an already filed 2023 tax return.

If the distribution amount transfered to your state return, you have to amend 2023 state return also.

@EA21440 

[dmertz]

Perhaps you misunderstood what the IRS told you.  What they were likely telling you (or should have been telling you) is that the missed distribution must be reported on your 2023 tax return on Form 5329, not on Form 1040 as income.

[EA21440]

My husband died in 2024. I inherited his IRA of $30,000. I took the RMD of $1600 and withheld $160 in taxes. The 1099-R lumps together the rollover and the RMD into 1 total. What are the steps to show on Turbo Tax Premium that most of this was rolled over and that I also took an RMD. Also, the 1st custodian charged me $50 for this. So I really rolled over $30,000-$1600- $50.  So where do I show the $50 because the figures will not add up for the IRS?

[AmyC]

You can understand the IRS is trying to make sure that everyone takes their RMD each year. Your RMD for 2024 was much less since you also took the 2023 RMD in 2024. 

Follow these steps:

1. When you enter the 1099-R, RMD for 2024? select Yes, some or all was RMD.
2. How much of it was RMD? Select All of it was RMD. Otherwise, the program thinks you did not take enough.
3. When asked how much is RMD, enter the distribution on the  1099-R or less.

Since you took the full RMD, the program will now be happy. This is not part of your tax return, just the program determining if you owe for not taking the full RMD.

[EA21440]

Thank you for your response.  However, when I tell Turbo Tax the entire amount is an RMD my tax payment goes from $5500 to over $12,000.  Wow!

[AmyC]

You entered yes, some or all RMD. Then you entered all was RMD. Then you entered an amount less than or equal to the form. You did this for every form. $5 payment, all RMD, $3 was RMD type of answers. Each form stands on its own. Don't enter total RMD for all forms for each form.

Take a look at your Form 5329 and see what the numbers are showing. Something is definitely not right. 

What about the codes on the forms? Are they all 7 for normal retirement?