RMD not taken by April 1, 2008

[doombuggy]

We sent the forms to the plan sponsor twice (plan valued annually) and as it turns out, the ee did not get their RMD (a whopping $113). I am trying to make the correction by having her take it asap, along with her RMd for 2008, but I am going in circles about the correction. TAG Data says to fill out form 5329 and to see if the IRS will grant a waiver of the 50% excise tax, but I am confused. This form is dated 2007, but would this be the correct year for the form? The instructions I got were:

With regard to filing Form 5329 for exemption from the 50% excise tax,

the instructions to Form 5329 (2007) provide the following:

Waiver of tax. The IRS can waive part or all of this tax if you can show

that any shortfall in the amount of distributions was due to reasonable

error and you are taking appropriate steps to remedy the shortfall. If

you believe you qualify for this relief, attach a statement of

explanation and file Form 5329 as follows.

Complete lines 50 and 51 as instructed.

Enter “RC” and the amount you want waived in parentheses on the dotted

line next to line 52. Subtract this amount from the total shortfall you

figured without regard to the waiver, and enter the result on line 52.

Complete line 53 as instructed. You must pay any tax due that is reported

on line 53.

The IRS will review the information you provide and decide whether to

grant your request for a waiver.

The third paragraph throws me - I'm confused; I had incorrectly reported to TAG that the woman turned 70 1/2 in 2006, when it was actually in 2007. i put $113.26 on line 50 (amt required) and $0 on the next line (amt pd in 2007), so line 52 would be $113.26. 50% is 56.63, but the tax should be waved. I'll bet the form is still sitting in the valuation binder and the trustee never gave it to her (his mom). I emailed it to them again last fall, but who knows?

Thoughts?

[J Simmons]

You might also want to check section 6.09(2) of Rev Proc 2006-27.