owner of business over 70 RMD from 401k
client is an owner of his company 100% with employees and they have a 401-k. He is 71 yrs old, still working and still contributing to the companies 401k
a. does he have to take an RMD even though he is still working and contributing to his 401k?
b. or can he hold off until age 75?
c. or does he have to take an RMD since he is over 5% owner of the company…but then can he still contribute to the 401k?
Thank you,
Douglas
Permalink Submitted by Alan - IRA critic on Fri, 2017-04-28 20:16
Yes, he is at least a 5% owner and his RMDs start at 70.5 whether working or not. He can continue to contribute to the plan, and the additional contributions he is able to make could offset the RMD income depending on the amount of the RMD and also if there is enough contribution space between what he was contributing before and the 24k max.