Hi,

Someone I know is planning to roll a $2.5M 401(k) into an IRA in 2016. Then they will transfer $1M from $2.5M IRA into another IRA, from which they will take 72t distributions.. They will turn 57 in 2016, and they plan to take 72t distributions from one of the IRAs, using the RMD method single-life table (divisor would be 27.9 in 2016 at age 57). Question: because these IRAs did not exist on 12/31/15 there is no IRA balance to put in the numerator with which to compute the distribution. What value would be used in this case? Would it be the account’s initial opening balance ($1M) which divided by 27.9 = $35,842.29 for 2016?

Thanks!