Fixing an RMD problem

[LCP]

The custodian should have already sent him his MRD for 2012 as well as a 1099-R. They can weasel out of the responsibility by claiming their client never told them to do it, but for all intents and purposes this is a cop-out. They just don't want to be liable to the participant in the event the IRS rings up a penalty. Virtually all custodians do this without prompting.

I'm not sure I agree with you. Isn't it true that as long as you take the correct amount out in total you don't need to take an RMD from each IRA? If that's the case, the custodian shouldn't be concerned that nothing has been distributed from that account. His obligation would simply be to advise the participant of the rules each year.

[zeros]

What Would Happen?

What would happen if you just started taking the RMD and hope the IRS would not catch it? Could they miss it?

[Snaggletooth]

Custodian

The custodian should have already sent him his MRD for 2012 as well as a 1099-R. They can weasel out of the responsibility by claiming their client never told them to do it, but for all intents and purposes this is a cop-out. They just don't want to be liable to the participant in the event the IRS rings up a penalty. Virtually all custodians do this without prompting.

There are charts in TTB, p. 13-8. If there are no other factors, he should divide the balance on 12/31 of the previous year by 18.7 yrs. to determine the RMD (if he is 80 yrs old). The divisor may change if he needs to use a different chart.

[LCP]

Relatively new client brings in an IRA statement and says, "I forgot to take an RMD out of this one. "

He's about 80. How would you determine the amount he should have taken out over the last ten years and then deal with the situation? I'm sure that there were a few years in which he took enough money out of his other plans by accident.