RMD Reminder

RMD Reminder

If you have an IRA or inherited an IRA, did you take your required minimum distribution (RMD) for 2017? Time is ticking away and you must take it by December 31st to avoid a 50% penalty!

Below are some basic RMD facts…

First RMD:
If you are an IRA owner who turned 70½ this year, you only have until April 1, 2018 to take your very first RMD. However, if you choose to delay your first RMD until 2018, you still must take your regular 2018 RMD so you will need to take two RMDs in 2018.

Subsequent RMDs:
After your first RMD, all subsequent RMDs must be taken no later than December 31st each year. Failure to take a timely RMD results in a 50% penalty on the undistributed amount.

RMD Calculation:
RMDs are calculated using the adjusted market value of your IRA as of December 31st of the preceding year. You can always withdraw more than the minimum.

For Multiple IRAs:
You must calculate the RMD amount for each IRA separately but if you have more than one IRA of the same type, you can aggregate and withdraw the entire amount from just one IRA or a portion from each IRA to satisfy your RMD.

For Inherited IRAs:
If you inherited an IRA (this includes Roth IRAs) you are required to begin taking RMDs each year by December 31st starting the year after the IRA owner dies. The 50% penalty that applies to IRA owners also applies to IRA beneficiaries.

If you need more information, your local retirement distribution expert or tax professional can assist!

More Updates

CRDS AND ROTH CONVERSIONS – ABUSE OF THE RULES?

The coronavirus-related distribution (CRD) rules for Roth conversions have a gaping hole. An “affected person” (as we have defined in previous blogs), is entitled under the CARES Act to withdraw up to $100,000 from their IRA or workplace retirement plan. A CRD avoids the 10% early distribution penalty for those under 59 1/2, can be

Read More »

Rolling Over an RMD

Like most people’s lives, the retirement world is upside down. This is made evident by a single statement: “Required minimum distributions (RMDs) can be rolled over.” Yes, that is the new normal—at least for this year. RMDs are considered the first money out of an IRA and workplace plan. Typically, these dollars are ineligible to

Read More »

Tapping Into Retirement Accounts If Not Directly Impacted By COVID-19

The recently-­‐enacted Coronavirus Aid, Relief, and  Economic Security Act (CARES  Act) signed by President Trump  on  March  27, 2020, allows  “qualified individuals” to take up  to  $100,000 of  penalty-­‐free IRA and company plan withdrawals during 2020. “Qualified individuals” include those who are (or whose family members are) sickened by the virus or who have virus-­‐related

Read More »
Scroll to Top