RMD-Secure Act

Submitted by Anthony Perrone on Tue, 2020-01-28 19:45

Have a client that turns 70 1/2 on 05/08/2020. Does she have to take an RMD this year?

If not, is she able to choose to start taking her RMDS if she wanted to? Or would this just be considered a normal distribution?

Just want to make sure understand this correctly that anybody that turns 70 1/2 after the new year 2020 they are not required to take an RMD. Only if they were 70 1/2 in 2019 they would continue their regular RMDS.

Thanks!



Submitted by Alan - IRA critic on Tue, 2020-01-28 19:55

Yes, you are correct.  She is not subject to RMDs until 2021. She can certainly take any distribution she wants this year, but it has no affect on RMDs other than to reduce the IRA balance at the end of 2020 which will reduce the first RMD for 2021.

Submitted by Anthony Perrone on Thu, 2020-01-30 16:01

The Year she turns 72 is when she will have to take their RMD by, no longer 1/2 year to worry about it, Correct? So her birthday is 05/08/2020 so she would need to take her RMD by December 31, 2021 in the year she turns 72. What happens if she takes a distribution on January 1, 2021 in the year she turns 72 does that count towards her RMD or is it considered a regular distribution because she isnt 72 yet? 

Submitted by Alan - IRA critic on Thu, 2020-01-30 16:20

She reaches 72 on 11/8/2021, so 2021 is her first RMD distribution year. However, she can still defer all or part of her 2021 RMD to 4/1/2022.  If she takes a distribution anytime in 2021 it is applied to her 2021 RMD, even if she has not yet reached age 72.  She can still do a QCD as of 5/8/2020, but there is no RMD for 2020 to offset. Starting in 2021, she should be aware of timing any QCD so that it will offset her 2021 RMD.

Add new comment

Log in or register to post comments