RMD to decedent in year of death?


J

Janie

My brother and I are the only beneficiaries of our dad's traditional
IRA. The money is in a CD, the fiduciary is a bank. Our dad died in 2010
and we plan to start taking distributions by the end of this year (2011).

A few months after his death, the bank took the 2010 RMD out of his IRA,
as it had done in prior years during that month. I asked the bank to put
the money back in the IRA, thinking it was a distribution to us which we
didn't want to take yet, and the bank did so.

Now that I'm paying closer attention to the regs about beneficiary IRAs
and RMDs, it seems that the 2010 RMD was for our dad?

Our 92-year-old father's income was low enough so that he was not
required to file a federal tax return, and he did not do so during the
last years of his life.

But, since the 2010 RMD was put back in the IRA, do we need to file a
5329 (additional taxes on qualified plans, including iras,) on his
behalf? Or because our father was not required to file a return, and
would have owed no taxes on the RMD, can we avoid filing a 5329 and
requesting relief for the 50% penalty?

Thanks for any guidance on this.

Janie
 
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D

D. Stussy

Janie said:
My brother and I are the only beneficiaries of our dad's traditional
IRA. The money is in a CD, the fiduciary is a bank. Our dad died in 2010
and we plan to start taking distributions by the end of this year (2011).

A few months after his death, the bank took the 2010 RMD out of his IRA,
as it had done in prior years during that month. I asked the bank to put
the money back in the IRA, thinking it was a distribution to us which we
didn't want to take yet, and the bank did so.

Now that I'm paying closer attention to the regs about beneficiary IRAs
and RMDs, it seems that the 2010 RMD was for our dad?

Our 92-year-old father's income was low enough so that he was not
required to file a federal tax return, and he did not do so during the
last years of his life.

But, since the 2010 RMD was put back in the IRA, do we need to file a
5329 (additional taxes on qualified plans, including iras,) on his
behalf? Or because our father was not required to file a return, and
would have owed no taxes on the RMD, can we avoid filing a 5329 and
requesting relief for the 50% penalty?
The year of death is usually a good reason to ask for a penalty to be
abated for cause.
 
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