Two RMDs in one year…?
Hello,
Last week I read a column in the newspaper saying I could use my RMDs in a Roth conversion. I was hoping I could believe it, but as this board proved… no such luck…!
This week the same guy corrected last week’s column, and added the following info… and I’m hoping he’s wrong again:
For years I’ve been reading that the first RMD is required to be made prior to April of the year following the year you reach age 70 1/2. In my case that would push my first RMD into 2014 (I’m 70 1/2 in December of 2013). However, this guy now sez the second RMD would also be required in 2014. Can this be true….?
Thanks…!
Permalink Submitted by Alan Spross on Sun, 2011-01-02 19:51
Yes, it is true, and this guy was apparently overdue to get something right.
It has always been the case that anyone who delays the RMD for their first distribution year to the RBD year must then take 2 RMDs for the RBD year.
Notes using your situation:
1) Your first RMD distribution year is 2013 because you reach 70.5 that year. You can delay that RMD until 4/1/2014, but you do not have to. You can even split the 2013 RMD between 2013 and 2014 up to 4/1/2014.
2) Your 2014 RMD must always be taken prior to 12/31/2014. So if you delayed your 2013 RMD to 2014 you might be inflating your marginal tax bracket in 2014 as a result of taking 2 RMDs in the same year. Your 2014 RMD will also be slightly higher than otherwise because your 12/31/2013 account balance will NOT have been reduced by your 2013 RMD.