How do I pay back R M D on a I R A that I thought had been closed out , but hadn't ?

[berniepine]

I owe 4 years of r m d on a fund I didn't know I owned . how can I mitigate my penalty ?

[JulieS]

The first thing you want to do is to contact the trustee of this account and have the missed RMDs distributed to you as soon as possible. You also need to know the amount that should have been distributed for each year.

The need to take an RMD in 2020 was waived for all, so you don't have to do anything for 2020.

If you have a 1099-R for the current year, you can easily add the information about your 2022 missed RMD to this year's tax return in either TurboTax Online or in TurboTax Desktop. Simply answer the questions about your RMD after you enter your 1099-R.

If you don't have a 1099-R, you will need to use TurboTax Desktop for 2022 or mail your tax return with Form 5329 attached.

Here is how to add Form 5329 to your 2022 tax return in TurboTax Desktop:

1. Click on  Forms mode in the upper right corner.
2. Click Open form on the left side near the top.
3. Type in 5329.  Choose 5329-T for the taxpayer (first person listed on your tax return), or 5329-S (for spouse - 2nd person on tax return). 
4. Click in the lower right hand corner of the pop up box. 
5. Scroll down to Part IX line 52 and enter the RMD amount that should have been taken. 
6. On line 53 enter the amount of the RMD that was actually taken (zero if it was missed).
7. Then in the box right under line 53 "Waver of Tax Smart Worksheet" enter the same amount as line 52 (the RMD amount). 
8. Then click the "Explanation" button and enter the reason for missing the RMD and your statement requesting a waver.

For 2021, 2019 and 2018, you can just do your Form 5329 manually using a copy from the IRS. Complete Part IX for each year you missed the RMD.

1. Complete lines 52 and 53 as instructed above. 
2. Enter “RC” and the amount of the shortfall you want waived in parentheses on the dotted line next to line 54. 
3. Subtract this amount from the total shortfall you figured without regard to the waiver, and enter the result on line 54.
4. Complete line 55 as instructed. You must pay any tax due that is reported on line 55.
5. Mail the form to the address for your state. Click here to find the address.

The IRS will review the information you provide and decide whether to grant your request for a waiver. If your request is not granted, the IRS will notify you regarding any additional tax you may owe on the shortfall. 
 

[berniepine]

Thank you Julie S for your detailed answer to my r m d question ! I had no idea where to start to get this problem resolved and you walked  me through it step by step . I appreciate the time you spent putting this answer together as well as your expertise !