RBD for client age 74 that is retiring as College professor and has 403b plan her retirement date is 8/31/2018.
If client age 74 retires 8/31/2018 and has 403b plan and has not made any RMD’S . If she waits until 4/1/2019 to start RBD would she be required to make two distributions in 2019 and for purposes of calculating the amount of distribution what date would be used ?
Permalink Submitted by Alan - IRA critic on Tue, 2018-06-26 16:58
Yes, 2018 will be the first RMD distribution year, but she can delay that RMD until 4/1/2019. Her 12/31/2017 balance and age on 12/31/2018 is still used to determine her 2018 RMD, and her actual balance on 12/31/2018 and age on 12/31/2019 is used to determine her 2019 RMD. Both RMDs would be taxable in 2019. If she does an IRA direct rollover, the RMDs due by the end of the rollover year must be distributed prior to the rollover being done, therefore such a rollover might accelerate the year she wants her RMD for 2018 taxed. To add further complexity, if she had a 12/31/1986 403b balance still tracked by her plan, RMDs on that balance do not begin until age 75 if she reaches 75 in 2019.