Misssed RMD IRS Penalty

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Missed Required Minimum Distribution

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The IRS missed RMD Penalty is 50% of what you were supposed to withdraw, but did not withdraw; and you pay taxes on the full RMD. I’m not sure what inspired you to arrive at this page.  We do know that money is an intense word.  We have spent much time learning how to best support people with their finances.

The short answer, you can file the needed forms with the IRS yourself.  Or you can ask for help.  Feel free to schedule a call with us.  If you prefer to do this yourself – we’ll gladly send you our guide, “Fixing a missed RMD in 5 Easy Steps”

Problem:

Missing a required minimum distribution (RMD) from your IRA can be devastating and costly.  Keep in mind the IRS missed RMD Penalty is 50% of the MISSED required distribution amount. Imagine you’re required minimum distribution (RMD) is $10,000 for a year and you forgot to take the distribution.  What might the impact of this be?

Let’s look at this:

$10,000

The amount you were to withdraw from your IRA

$5,000

IRS's missed RMD penalty!  This is 50% of what you were supposed to withdraw

$3,500 

Is the taxes on the whole amount, assuming 35% for federal and state taxes

1,500

Is all you get after that mistake and paying the IRS's missed RMD penalty!

IRS Missed RMD Penalty Solution:

How do you fix or correct the IRS missed RMD penalty issue?  It might seem scary at first.  We have a comprehensive checklist system that we use.  One of the checklists allows us to work with you to correct this issue and POSSIBLY even avoid the penalty.  You will always have to pay your taxes – can’t help you there!

Get our guide, “Fixing a missed RMD in 5 Easy Steps” – Click the button below.  We are committed to your privacy, no credit card is needed and you can remove yourself at anytime.  The steps show you how to correct this yourself, if you want to.

If what you need or want is to have some focused assistance, for a fee, we can provide that support.  If you want the do it yourself route – get our whitepaper.  If you would like support in filling out and submitting the paperwork – give us a call.  The office number is 408-459-8383.  The fee? Yes, we, like you, don’t work for free.  The fee depends on a variety of factors.  The minimum fee is $250.  The most challenging case we have worked on is someone with 13 years of missed required minimum distributions.

Overview of calculating an RMD

Take the owner’s age as it would be at the end of the year your doing the calculation for.  Then, you locate their remaining age expectancy in the IRS life table.  You then locate the balance of the account on December 31, of the year before the current year (assuming you are calculating the RMD for this year).

Next step is to do some math.  Divide the account balance by the life expectancy.  The result is the amount you need to withdraw from the account.  Repeat across all accounts.  Note: there are provisions for how and where you can withdraw the money.

Get some help correcting the situation

We are highly skilled at helping people make the request to have the penalty waived.  If you would like some assistance we are here for you.  The key question is what is this going to cost you?  Well, as little as $250.  If you are filling out the tax forms we can guide you through the process. What works for you? Call our office and let’s see what we can work out 866-589-9366.

We are a fee only Investment Advisor.  We work from a fiduciary standard – we’ll explain this when you call.

Bonus Offer

As mentioned, Onesta Wealth Management is a fee only Registered Investment Adviser firm.  The bonus is this, we will work with you to build a comprehensive retirement income plan.  If you hire us to create this plan we may be able to include fixing your Missed Required Minimum Distribution issue (if only one year has been missed).

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