What are the consequences for not taking the mandatory distribution from an IRA?

My mother, an 81-year-old widow, erroneously neglected to take the mandatory distribution from her IRA for 2007. What are the consequences, and are there any exceptions to penalties? She's getting on in years, and I forgot to instruct her broker.

After age 70½, people who do not receive the minimum amount required by the tax law must pay a penalty of 50% of the difference between the minimum amount you should have received and the amount you did receive. So, if mom should have received $3,000 but she received nothing, she needs to pay a penalty of $1,500.

You can throw yourself on the mercy of the IRS. They do offer relief. To see if you will be granted relief, they ask that you: file Form 5329 with your 1040; pay any penalty owed; and attach a letter of explanation. If they like your story, they'll refund the money. Good luck!