Designated Beneficiary
Definition A designated beneficiary is an individual (person) beneficiary whose is designated as beneficiary of a qualified plan account, 403(b) account, 457(b) plan or IRA,
February 28, 2009
If an individual fails to distribute his RMD by the deadline, he will owe the IRS an excess accumulation penalty of 50% of the shortfall. The excise tax is reported on IRS Form 5329 and IRS Form 1040 (your income tax return).
If the client missed the deadline due to a reasonable cause, he may ask the IRS to waive the 50% excise tax, by attaching a letter of explanation to his completed Form 5329. He should include proof that he has taken steps to remedy the issue by withdrawing the amount. Proof of the withdrawal should be included with his request.
If the IRS approved his request, he would not need to pay the excess accumulation penalty
Definition A designated beneficiary is an individual (person) beneficiary whose is designated as beneficiary of a qualified plan account, 403(b) account, 457(b) plan or IRA,
Definition The beneficiary 10-year rule is the maximum period that certain beneficiaries may keep inherited retirement accounts in a beneficiary account. Watch/listen to a video
Definition For beneficiaries who inherit retirement accounts, a common question asked is “What is the 5-Year Rule for beneficiaries?” The beneficiary five-year rule is the
An eligible designated beneficiary is a designated beneficiary who, at the time of the IRA owner or plan participant’s death, is : A. the surviving
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