Fixing an excess IRA contribution or a missed RMD: avoiding the 6% and 25% taxes and asking for a waiver on Form 5329
An excess IRA contribution costs 6% a year until fixed, but removing it with earnings by the filing deadline including extensions avoids the tax, and an excess Roth contribution can be recharacterized. A missed RMD costs 25%, cut to 10% if corrected in time, and Form 5329 lets you ask for a full waiver. Plus late rollovers and the new 2027 IRA correction program.
Read article