What does the IRs require for waiver of the excise tax on Form 5329 fo
Posted 09 January 2001 - 10:21 AM
Since learning of the problem she has received the minimum distributions for the years after his death, terminated the plan and the services of the trustee, rolled the funds over to a new IRA and begun receiving minimum distributions from the IRA. However, there are still 3 years for which no distributions were made and excise taxes on Form 5329 are due.
The instructions say the IRS may waive the tax if it was due to reasonable error and "you are taking appropriate steps to remedy the shortfall."
Assuming that blaming the Trustee is accepted as reasonable error, will the IRS require a distribution of the minimum distribution amounts from the 3 earlier years in addition to the amount for the current year as a condition of the waiver? If so, must the client make the distribution before the waiver request and run the risk of having it denied? Is there any chance that merely correcting the errors going forward will be sufficient for the waiver without making the distribution for the earlier 3 years?
Posted 18 January 2001 - 12:42 PM
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Posted 18 January 2001 - 04:25 PM