I have seen the IRS offer more forgiveness than anything else. Welcome to the Retire On Time q and a podcast. I'm Michael Decker with David Franson from Kedric Wealth. This show is all about getting into the nitty gritty. We don't wanna give you oversimplified advice.

We wanna give you context and clarity. So text your questions to (913) 363-1234, and we will feature them on the show. Just remember, this isn't financial advice. This is educational. It's informational.

We wanna help push you in the right direction, but do your research. David, what have we got today?

Hey, Mike. I missed my RMD. What do I do next?

Seek tax help?

Yeah. Yeah. Pray to the gods. Don't know. So there is a form that you

can fill out if it was an honest mistake as a one off. Typically, what I see when this happens is you've got first off, take your your RMD for this year and last year. So you need you still need to do it. Right? The penalty can be stiff.

But then there's a form, and I can't remember the form off the top of my head. Do you know? It's 55589

or something like that. It's four numbers. Yeah.

Start with 5. Yeah. Google it. Google it real quick.

Oh, yeah. Like, fortunately, good. Yes.

But or or a duck duck go it.

It's just not the same. Bing

it. Not the same.

Not at all.

So but what you do is you fill out the form, and in the last section, you're gonna put the RMD you're supposed to have. You put the section that of, like, what the penalty was supposed to be. And then what you would do is you put RC for what was RC for? It's it's for requesting correction or basically

Something like

asking for forgiveness. RC is the term, though.

Yes.

And then so you just ask for forgiveness with it, and then you write a letter explaining exactly what happened and why it will never happen again. It's like Bart Sips and writing on the chalkboard.

Right? But, look, if if you've taken

it out, you're trying your best, and you're proactive with the IRS, they're actually very forgiving.

I know that Hollywood has made auditors and, you know,

the IRS to be these these bad guys. I found them to

be quite amenable. Like, they're pleasant. If you're not a jerk to them, they're gonna be pleasant with you. They want to help you. They're not gonna help you make criminal activities possible.

They're gonna just say, here's the return. Look, if there's new information I need to know, let me know, but this is kind of They're good people.

I've found these conversations to be rather pleasant.

So it's IRS form 5,329. 5,329, thank you. Yes. And then there's a section on there where if you didn't receive the the minimum required distribution from your retirement plan, you can make it right.

You you make it right. Be proactive about it. Write them up a letter. Yeah. Maybe use your AI to help you write a really good letter.

Oh, yeah.

Right? Make it professional. Yeah. That's a thing. But but be proactive about it.

There's a a certain period that you're supposed to report these things. Again, being proactive about it. But I have seen the IRS offer more forgiveness than anything else. So there is a high probability if it's a legitimate error of omission, something happened, whatever it is, just fill out the form, attach the letter, send it in, and that should help. It increases your odds of not having to pay the stiff penalty.

Yeah. Which is like 10 or 20% depending on

25%. It's stiff.

25. Yeah. I think that's right.

Yeah. So, anyway, that's the form. That's the protocol. That's what you do. It's not a guaranteed success, but if you get ahead of it, like, you should be fine.

Hopefully, you're fine.

Fingers crossed, knock on wood, all that stuff.

Yeah. And then create a system where you don't do it again.

Yeah. There's the big lesson.

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