How to Report a Missed RMD: Form 5329 and Reasonable Cause

To report a missed required minimum distribution, withdraw the shortfall from your retirement account as soon as you can, then file IRS Form 5329 for the year you missed the RMD, completing Part IX and attaching a written statement asking the IRS to waive the excise tax for reasonable cause. The penalty is 25% of what you failed to withdraw, dropping to 10% if you correct the miss within the correction window, and often to zero when the IRS grants a waiver.¹

Take the Corrective Distribution First

Before any form gets filed, pull the missed amount out of the account. If you should have taken $10,000 in 2025 and didn’t, withdraw $10,000 now. This corrective distribution counts as taxable income in the year you actually take it, not the year it was owed. Your custodian will send a Form 1099-R for the withdrawal, typically coded “7” for a normal distribution.²

Withdrawing the money does not, by itself, erase the penalty for the year you missed. It’s the prerequisite that makes a waiver request credible. Form 5329 is what actually resolves the excise tax.

Calculate the Shortfall

The shortfall is the difference between the RMD you owed and what you actually withdrew during the year. Your RMD equals the account balance on December 31 of the prior year divided by a life expectancy factor from the IRS Uniform Lifetime Table, or the Joint Life Table if your sole beneficiary is a spouse more than ten years younger.³

A $10,000 shortfall produces a $2,500 excise tax at the standard 25% rate, or $1,000 at the reduced 10% rate available inside the correction window. You need this number even if you plan to request a full waiver, because Form 5329 asks for it.

The correction window runs from the date the RMD was due until the earliest of three events: the IRS mails you a deficiency notice, the IRS formally assesses the tax, or the last day of the second tax year after the year the penalty applies.⁴ For a missed 2025 RMD, that generally means through the end of 2027.

Complete Form 5329, Part IX

Form 5329 is titled “Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts.” The section that handles a missed RMD is Part IX, “Additional Tax on Excess Accumulation in Qualified Retirement Plans.”⁴

Part IX walks through three numbers on a few lines. Enter the total RMD required for the year on lines 52a and 52b, which split the amount by account type. Enter what you actually distributed on lines 53a and 53b. The shortfall carries to lines 54a and 54b, where the excise tax is calculated.

If you’re asking for a full waiver, write “RC” (for reasonable cause) followed by the dollar amount you want waived in parentheses on the dotted line next to line 54a or 54b. Then subtract that waived amount from the shortfall and enter the result on the line itself. When the whole penalty is being waived, that result is zero.⁴ If you’re claiming the reduced 10% rate rather than a waiver, calculate 10% of the shortfall and enter that as the tax. The total from line 55 flows to Schedule 2, Line 8 of your Form 1040.⁵

Entering zero on the penalty line without an explanation letter will not get you a waiver. The letter is what turns the filing into a request the IRS can grant.

Write the Reasonable Cause Statement

The IRS can waive the entire excise tax when the failure was due to reasonable error and you’re taking reasonable steps to fix it.⁶ You demonstrate both in a short written statement attached to Form 5329.

Keep it factual and cover four things: the tax year of the missed RMD, the exact shortfall amount, what caused the miss, and the date you took the corrective distribution. Reasons the IRS commonly accepts include an administrative error by your financial institution, a serious illness, the death of a spouse who handled the finances, or confusion during your first RMD year. The agency is looking for evidence you were trying to comply, not that you ignored the rule.

Attach documentation if you have it. A custodian’s letter admitting a processing error carries real weight. Medical records, a death certificate, or correspondence showing you requested the distribution on time all help the case. Include your account numbers and contact information.

One boundary worth flagging: the IRS’s “First Time Abate” program does not cover the RMD excise tax. That program applies to failure-to-file, failure-to-pay, and failure-to-deposit penalties under different code sections.⁷ A missed RMD has to go through reasonable cause on Form 5329.

Where and When to File

The filing path depends on where you are in the tax year cycle for the year you missed:

If the original return isn’t filed yet, attach Form 5329 and your explanation letter to your Form 1040 for the year the RMD was missed. The tax (or zero, with a waiver request) carries to Schedule 2, Line 8.
If you already filed the return for that year, submit Form 1040-X to amend it, with Form 5329 attached.⁴
If you weren’t required to file a federal return for that year, Form 5329 can go in as a standalone document. Mail it to the address where you would file a Form 1040. A standalone Form 5329 cannot be e-filed.⁴

Always use the Form 5329 from the year the RMD should have been taken, not the current year’s form. Prior-year forms are on the IRS website. If you missed RMDs in more than one year, file a separate Form 5329 for each year, each with its own explanation and supporting documents.

Why Filing Matters Even If You’d Rather Not

The three-year statute of limitations on IRS assessments does not start running on the RMD excise tax until you file Form 5329 for the year in question. Skip the form, and the IRS can assess the penalty five, ten, or twenty years later. There is no time limit on the exposure.

Filing Form 5329 with a reasonable cause letter does two jobs at once: it requests the waiver, and it starts the clock. Once the form is on file, the IRS generally has three years to challenge the return. After that, you’re protected.

If you’re just now discovering a missed RMD from years ago, file Form 5329 for each year you fell short, using each year’s version of the form. Take the corrective distribution now, attach the reasonable cause letter, and request the waiver. The IRS has been consistently willing to grant these late-filed waiver requests when the taxpayer has already fixed the shortfall.

Inherited Accounts Follow the Same Path

Beneficiaries who inherit traditional IRAs or other tax-deferred accounts face the same penalty structure and use the same Form 5329 process when they miss a required distribution.⁸ Whether you actually owed an annual distribution depends on your beneficiary category and when the original owner died, which is its own analysis. If you’ve inherited a retirement account and aren’t sure whether an RMD was due, confirm with the custodian before assuming there was nothing to miss. Custodians don’t always send inherited-account beneficiaries the same reminder notices they send original owners, which is why these misses turn up more often on this side of the rules.

1
Office of the Law Revision Counsel. 26 USC 4974 – Excise Tax on Certain Accumulations in Qualified Retirement Plans
2
Internal Revenue Service. Instructions for Forms 1099-R and 5498
3
Internal Revenue Service. Retirement Topics – Required Minimum Distributions (RMDs)
4
Internal Revenue Service. Instructions for Form 5329
5
Internal Revenue Service. 2025 Schedule 2 (Form 1040)
6
eCFR. 26 CFR 54.4974-1 – Excise Tax on Accumulations in Qualified Retirement Plans
7
Internal Revenue Service. Administrative Penalty Relief
8
Internal Revenue Service. Retirement Plan and IRA Required Minimum Distributions FAQs