No. If you file the 2023 5329 with your 2023 return the IRS will likely waive the penalty as they have for years. You just need to fill out the 4 lines on the 5329 correctly, as advised in a prior post. It's not intuitive, so read the instructions. Do not pay the penalty when you are requesting a waiver for "reasonable cause" and the reasonable cause can be about anything including "I forgot".If I understand you, the penalty would be paid with my 2023 tax return, but the tax on the distribution would be paid for tax year 2024. Is this correct?
However, since you must also take your 2024 RMD, both the late 2023 RMD and the 2024 RMD could increase your marginal rate in 2024, and there is no solution for that. But your 2023 taxable income will not include an RMD, so you should save on taxes in 2023, but the 2023 savings may not offset the increase in 2024.
Statistics: Posted by Alan S. — Tue Mar 05, 2024 6:00 pm — Replies 3 — Views 341