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Missed my IRA RMD for TY2014

I searched this group for the answer but some of the info goes back more than a decade! I know things have changed several times over the years so I am asking again to be sure.

I was under the impression that the custodian of my IRA was going to automatically execute the appropriate RMD and put the money in my cash account. I guess I was wrong, or they lost the paperwork, or the dog ate it or some damn thing.

I just got my 1099 and see that I have NOT taken the RMD before 12/31/2014.

My understanding is that the recommendation is to:

1) Take it immediately, 2) File a Form 3529 with the IRS, 3) Do NOT pay the penalty (Unless the waiver is denied) 4) Ask for a waiver of the penalty, providing - Good reasons for the error - A copy of paperwork showing that the RMD has been made - Explain how it will never happen again. 5) Mail the form separately from the 2014 return (especially as I probably won't have other things sorted out by April 15 and will need to file an extension.

My questions:

1) Is that the correct plan? Any problems with it? 2) What constitutes a "good reason" in the eyes of the IRS. Some have said that they will grant a waiver the first time. Others indicate that they want the money so badly that they are reluctant to grant a waiver.

My reasons are that I expected the custodian to do its job and withdraw it automatically. However, I really should have been more on top of this ... but I'm a bit new to the RMD. I'm not sure how to make a convincing case for this. Drat, I only missed it by a month!

Any advice you can give me would be much appreciated.

Reply to
mikes.mail.lists
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Did you just turn 70 1/2 in 2014? If so, you have until April 1, 2015 to take your RMD for 2014, with no penalty. However, you will have to take your 2015 RMD by December 31,

2015, so you will have to pay tax on two RMDs in 2015. The April 1 rule is only for the first year.

The custodian's job is to tell you how much your RMD is. They cannot take money out of your account without explicit instructions from you.

Bob Sandler

Reply to
Bob Sandler

I made my first two RMDs two years ago -- the one for 70 1/2 and the next full year. This is the next payment which was due, as I said, by 12/31. And that is the point of my question.

Yeah, got that. I'm actually concerned about TY 2014. That is the one that was due on 12/31/2014. (The one for TY 2015 is not due until 12/31/2015.) But I was told that I did NOT JUST pay tax on two payments for TY 2015, but that I had to pay a penalty in addition. THAT is the real problem.

Yes, that's true. However, I signed an automatic RMD deduction thing with the custodian. I'm sure they just lost the paperwork. Two of my holdings were bought out this year so I got a statement at the end of the year but they did not have the purchase price listed. I bought it through them and I expect them to keep records but ... I suppose it is time to ditch them in favor of someone else.

Thanks for your response, Bob.

Reply to
Mike

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