Just checking to make sure client has to take RMD before his rollover from 401(k). Client is age 78 and terminated with his company last June. He was more than a 5% owner so he did take an RMD last year as required.
The company was sold last year and the assets moved over to a new provider in Jan. 2018. Now we want to do the rollover of his 401(k).
Thank you. A follow up question…on his RMD, the form gives two choices. 1) the life expectancy calc. based on the IRS uniform table. 2) the lowest possible minimum distribution based on applicable IRS table. My spouse is my sole primary beneficiary & is more than 10 years younger than me. His birthdate is 3/1/1939 & hers is 1/18/1950 & the prior year balance is $1,491,000. The amounts i got for the two different calculations are $76,461 & $74,179. Not much different. Is that correct?
Permalink Submitted by Alan - IRA critic on Wed, 2018-02-21 18:40
Yes, his 2018 RMD must be distributed before or at the same time as an IRA rollover of the balance. Note that IF client has any after tax contribution balance in the 401k, this is the last chance to do a split rollover with the after tax amount going to a Roth IRA, and the rest to a rollover TIRA. Also last chance to consider any NUA potential.