RMD Start Date
Suppose someone attains age 70 in August, 2013 and decides to commences RMD’s from a traditional IRA in 2013. The calculation of the RMD’s amount would be based on the December 31, 2012 account balance and the single life factor (27.4) would be the divisor since the spouse beneficiary is not 10 years younger. Correct?
Permalink Submitted by Alan - IRA critic on Sat, 2013-03-09 17:54
No. The first RMD year is the year IRA owner reaches 70.5, not 70. This person would not reach 70.5 in 2013 and the first RMD year would be 2014. However, assuming that you meant 70.5, the answer to your question would be the 12/31/2012 balance would be used to determine the RMD. The correct table is the Uniform Table, and you must have used that since the divisor would be 27.4.
Permalink Submitted by Robert Yunich on Sun, 2013-03-10 16:12
Okay, since this person attains age 70 in August, 2013 and 70.5 in February, 2014, this person normally would take the first RMD by April 1, 2014 and a second by December 31, 2014. However, by taking the first RMD during 2013, this person avoids doubling up in 2014. So, back to the original point, this person takes the initial RMD in 2013 based on the December 31, 2012 account balance and the single life factor (27.4); the RMD taken during 2014 is based on the December 31, 2013 balance and the factor from the Uniform Table for age 71. Right?
Permalink Submitted by Alan - IRA critic on Sun, 2013-03-10 16:45
No. If 70.5 is reached in Feb, 2014, the first RMD year is 2014 and can be deferred to as late as 4/1/2015. But since that would result in 2 RMDs in 2015, the first RMD would usually be taken in 2014 using the 12/31/2013 account balance. There would be no RMD in 2013 since the person has not yet reached 70.5 on 12/31/2013. Further, since the person will reach 71 in 2014 (first RMD year), the divisor for that first RMD is 26.5, not 27.4.
Permalink Submitted by Robert Yunich on Sun, 2013-03-10 17:23
Thank you very much — I now understand.