Ask Bob: I Inherited an IRA, But Didn't Know I Needed to Take RMDs

Question: Two questions if you don't mind. First, I inherited Roth IRA about five years ago and just learned that I was required to take minimum distributions. What's the penalty that I have to pay and what should I do now to become compliant with IRS rules/laws. Second, I also inherited a traditional IRA at the same time and wonder if it's possible for me to make a qualified charitable distribution (QCD) with my RMDs for that account even though I'm not yet age 70½? Thank you.

Answer: According to Beverly DeVeny, the director of retirement education at Ed Slott and Company, the answer is to your first question is: It depends.

"You will have to look at the IRA agreement to see what the default distribution period is for the inherited Roth IRA," she says. "When the document defaults to the five-year payout period, then you would have been required to empty the account by the end of the fifth year after the account owner's death."

The required distribution, or RMD, for that year is the account balance.

Now, if you missed that RMD, the penalty is 50% of the account balance, says DeVeny. "If you have not missed that deadline, then there is no missed RMD, as long as you empty the account in a timely manner, and no further tax reporting is needed," she says. "When the document defaults to a lifetime payout, then you have to calculate your missed RMDs and take them."

In both cases, DeVeny says you have to file Form 5329 for each year that had a missed RMD. "The penalty can be waived for good cause," she says. "You need to submit the forms -- make sure there is a zero on the last line -- and a note explaining the circumstances and request a waiver."

And, lastly, DeVeny recommends that you work with someone knowledgeable to help you with the calculations and filing the forms.

The answer to your second question is: No. "Beneficiaries can do QCDs, but they must follow all the rules for account owners, including the one about actually being age 70½ at the time of the QCD," says DeVeny.

Got questions about the new tax law, Social Security, Medicare, retirement, investments, or money in general? Want to be considered for a Money Makeover? Email Robert.Powell@TheStreet.com.