Updated October 17, 2026. Quick answer: Lines 54a and 54b of Form 5329 turn the shortfall from lines 52 and 53 into the additional tax, and line 55 adds the two and sends the total to Schedule 2 (Form 1040), line 8. The tax is 25% of the shortfall, and 10% if you corrected it in time. If the shortfall was due to reasonable error and you are taking reasonable steps to remedy it, you can ask the IRS to waive it by attaching a statement of explanation and entering RC and the amount you want waived in parentheses on the dotted line next to line 54.
What the additional tax is
The instructions define the tax: “The additional tax is 25% of the excess accumulation, which is the difference between the amount that was required to be distributed and the amount that was actually distributed.” On timing they say “The tax is due for the tax year that includes the last day by which the minimum required distribution must be taken.” The input lines are on lines 52 and 53. Line 54 is where the shortfall becomes a dollar amount of tax.
Lines 54a and 54b: which rate applies
The two lines are split by rate. Line 54a reads “Subtract line 53a from line 52a and multiply the result by 10% (0.10).” Line 54b reads “Subtract line 53b from line 52b and multiply the result by 25% (0.25).” The instructions describe the result as “This is your total excess accumulation.” and tell you how to choose: “To figure the additional tax on the excess accumulation, you must first determine which tax rate applies.”
The default is stated plainly: “Generally, the additional tax rate for distributions that are less than the minimum required distribution amount (excess accumulations) is 25%.” Publication 590-B says the same thing from the IRA side: “you may have to pay a 25% excise tax for that year on the amount not distributed as required.”
The reduced rate and the correction window
The lower rate has two conditions. “You may be eligible for a reduced tax rate of 10% if, during the correction window, you” do both of these: “Receive a distribution of the amount that resulted in the excess accumulation from the plan for which the tax was imposed” and “Submit a return reflecting the additional tax.”
The window has a defined end: “The correction window ends on the earliest of the following dates.” The three dates are “The date of mailing the deficiency notice with respect to the imposition of this tax”, “The date the tax is assessed”, and “The last day of the second taxable year that begins after the end of the taxable year in which the additional tax is imposed.” That is why line 52a and line 53a ask about plans where the full amount was distributed during the window.
Asking for a waiver: the RC entry
The instructions allow a request for relief: “The IRS can waive part or all of this tax if you can show that any shortfall in the amount of distributions was due to reasonable error and you are taking reasonable steps to remedy the shortfall.” The method begins with “If you believe you qualify for this relief, attach a statement of explanation and file Form 5329 as follows.”
Step one is “Complete lines 52a and 52b, and 53a and 53b, as instructed.” Step two is “Enter “RC” and the amount of the shortfall you want waived in parentheses” “on the dotted line next to line(s) 54a and/or 54b, as applicable.” The instructions then say “Subtract this amount from the total shortfall you figured without regard to the waiver, and enter the result on line(s) 54a and/or 54b, as applicable.”
Step three is “Complete line 55 as instructed.” The instructions follow it with “You must pay any tax due that is reported on line 55.” The decision rests with the IRS: “The IRS will review the information you provide and decide whether to grant your request for a waiver.” “If your request is not granted, the IRS will notify you regarding any additional tax you may owe on the shortfall.” Publication 590-B describes the same request: “you can request that the tax be waived.”
Line 55 and where it goes next
Line 55 reads “Add lines 54a and 54b.” It continues “Include the total on Schedule 2 (Form 1040), line 8”, which is the same landing spot as the Part I tax described on the Part I page. The Schedule 2 page explains that schedule.
A simple arithmetic illustration
This is an illustration, not an IRS example, and it assumes no waiver and no correction. Suppose line 52b is $4,000 and line 53b is $1,000. The subtraction leaves $3,000. The line 54b result is computed as 25% of $3,000, which is $750 under the rule quoted above. If the same $3,000 shortfall sat on the 10% line instead, the result would be $300. The numbers are invented to show the order of the steps, and your own amounts come from your own accounts. For the situation after a missed withdrawal, see the missed RMD page.
Edition and line numbers
This page reads the 2025 Form 5329 and its 2025 instructions, and where it cites Publication 590-B it reads the 2025-returns edition. These are the current files irs.gov served on 2026-10-17, and they are the forms for the tax year 2025 return, filed in 2026. Check the tax year printed on the form you are filling in and use the line numbers on that year’s form, because a different year’s form can number or word its lines differently. Part I of the form is covered on the Part I page, and the whole form is mapped in Form 5329 explained. This page is about missed required distributions, not the early withdrawal penalty exceptions.
Common mistakes
- Assuming the lower rate applies automatically. The instructions say “Submit a return reflecting the additional tax.” is one of the two conditions for the reduced rate.
- Treating the correction window as open-ended. The instructions say “The correction window ends on the earliest of the following dates.”
- Skipping the statement when asking for a waiver. The instructions say “attach a statement of explanation and file Form 5329 as follows.”
Related: Form 5329 explained, Missed your own RMD, Schedule 2 (Form 1040), and Missed inherited IRA RMD penalty.
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Answer againSources
- Instructions for Form 5329 (2025): https://www.irs.gov/pub/irs-pdf/i5329.pdf
- Form 5329 (2025): https://www.irs.gov/pub/irs-pdf/f5329.pdf
- Publication 590-B, Distributions from Individual Retirement Arrangements (IRAs) (for 2025 returns): https://www.irs.gov/pub/irs-pdf/p590b.pdf
Read from the IRS documents linked above on October 17, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the account provider or the IRS is the right place to confirm anything consequential.