Deceased father's RMD 2021

[constance e]

My father passed away in April 2021 and he had not yet taken his RMD for 2021.  He was over 80 and was required to take a yearly RMD .   My sister and I are the beneficiaries of his IRA (now considered an "Inherited IRA" to us.)  Since he did not take his RMD for 2021 prior to his death, my sister and I as the IRA beneficiaries, are required to take it for 2021 and report it on our personal taxes, otherwise we incur a tax penalty of 50% of the RMD.   (We have taken the RMD.)  

My question is, I am completing my father's final personal Return for 2021 (the year of his death). How do I answer the RMD question since he didn't take it.  If I mark that he didn't, then Turbo Tax  goes into information requesting a Waiver from the IRS.   I feel like I'm missing something.  Turbo Tax is usually good at creating different tax scenarios for examples, but other than asking whether or not the filer is alive in the initial profile set up, it doesn't address any tax items that might be affected by his death.  

[AmyC]

In order for you to get to the RMD question, you are inputting something. The RMD question goes with the form you are inputting. If it is a 1099-R from a pension, then yes, all of that pension was RMD. Since you and your sister are putting the IRA on your returns, it would not be on your father's.

The IRS has a quick  How Do I File a Deceased Person program. It is very detailed and may give you additional information.

I am very sorry for your loss.

Related: Required Minimum Distributions for IRA Beneficiaries

[fanfare]

If the owner died on or after the required beginning
date, the IRA beneficiaries are responsible for figuring and
distributing the owner's required minimum distribution in
the year of death.

If you did not do that then technically, the final return should include Form 5329
and a request for waiver.
The IRS will grant the waiver, assuming
you explain that you are taking and reporting the RMD on your own next year tax return.

You will also have to take your own beneficiary  RMD for 2022.

[fanfare]

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[constance e]

My sister and I are taking our father's RMD on our personal returns this year in accordance with the tax laws since we are the named beneficiaries of his IRA and he died in 2021 and hadn't taken his RMD for 2021 yet.   

My concern is that since he was required to take an RMD from his IRA, but hadn't yet, how will the IRS know that my sister and I took it on his behalf ?  The 1099-R we received for the RMD doesn't cross reference his SS #.  It only provided the distribution code "4" (death).

The question came up when I inputted his monthly pension information. TT asks whether or not he took his RMD.     If I understand the response I received prior to yours, TT asks that question as it pertains specifically to the information I inputted which was for his monthly pension payments (not his IRA).   Maybe I am reading too much into the technicalities. 

With regard to your last note regarding us taking our personal RMD in 2022, due to our age, we do not need to take an RMD and since the IRA is an "Inherited IRA", we have 10 years to take the distributions to deplete the account.      

[JulieS]

Yes, you are getting a little too technical with this.

When TurboTax asks if your father took his RMD for 2021, you can answer yes, because the RMD was taken by his beneficiaries.

The IRS tracks the IRA accounts and whether the RMD was taken. They don't try to cross reference SSN of owners, decedents and beneficiaries.

[constance e]

Thanks!