Does the IRS have to be notified whether an individual took RMDs during the year or just that RMDs were required to be made during the year?

There is no requirement other than the 1099R to report any distribution from a plan. The requirement to report that an RMD is due is only for IRAs. No such requirement exists for qualified plan trustees.

See the instructions for box 11 of the instructions at http://www.irs.gov/pub/irs-pdf/i1099r.pdf ( page 13).

As jevd said, the IRS is notified when the RMD actually occurred by way of the 1099-R. The IRS is also notified that an RMD is due for the year by way of the 5498. The 2004 5498, which is used in 2005, is used to notify the IRS that an RMD is due for 2005