The IRS has issued guidance to financial institutions for reporting required minimum distributions (RMDs) for 2023. The guidance, contained in Notice 2023-23, implements a change to the RMD rules made by the SECURE 2.0 Act, which delayed the required beginning date for RMDs.
Under this change, IRA owners who turn 72 in 2023 will not have an RMD for 2023 (because the age with reference to which the required beginning date is determined for those IRA owners is changed from 72 to 73).
If an IRA owner has an RMD due for 2023, the financial institution that is the trustee, custodian, or issuer maintaining the IRA must file a 2022 Form 5498 (IRA Contribution Information) by May 31, 2023, and indicate by a check in Box 11 that an RMD is required for 2023. The institution may also choose to provide further information in Box 12a (RMD Date) and Box 12b (RMD Amount).
For those IRA owners, the RMD statement required under Notice 2002–27 should not be sent, and the 2022 Form 5498 should not include a check in Box 11 or any entries in Box 12a or 12b.
But the IRS adds that it recognizes the short amount of time that financial institutions have had to change their systems for furnishing the RMD statement since the enactment of the SECURE 2.0 Act.
Accordingly, Notice 2023-23 provides relief — the IRS will not consider an RMD statement provided to an IRA owner who will turn 72 in 2023 to have been provided incorrectly if the IRA owner is notified by the financial institution no later than April 28, 2023, that no RMD is actually required for 2023.
What SECURE 2.0 Did Not Do
SECURE 2.0 did not change the RMD required beginning date for IRA owners who attained age 72 before Jan. 1, 2023.
Consequently, to reduce misunderstanding among IRA owners, the IRS encourages all financial institutions to remind IRA owners who attained age 72 in 2022 and have not yet taken their 2022 RMDs, that they are still required to take those distributions by April 1, 2023.
Publication
Notice 2023-23 will be in published in Internal Revenue Bulletin (IRB) 2023-13 on March 27, 2023.
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