2009 RMD from IRA invested in Annuity w/GMIB
I have a number of tax clients that have IRA’s invested in annuities. One of the benefits of the annuity is a 6% Guaranteed Minimum Income Benefit (GMIB). The statements reflect the fair market value of the account and also a GMIB based upon the 6%. guarantee. Due to the market, this is the first I have seen the that the GMIB is greater than the FMV of the account.
My question is – since this GMIB exists, how does this impact the RMD calculation for next year? An associate of mine (who sells these products) have talked to the various insurance companies he works with and has received various answers. Thank you.
Permalink Submitted by Al Fry on Thu, 2008-10-30 02:50
The actuarial present value of any additional benefits MAY have to be added to the acct. value for RMD purposes. My experience has been this has been minimal in the past (affecting less than 10% of annuities in IRAs). Unless the market turns around (which it NORMALLY does after a Presidential election), this could affect many more RMDs for 2009.