IRA RMD at 70 1/2
Question: If I wait to April 1st after the year when I turned 70 1/2, I’ll have to make two RMDs. In my case, one for 2008 and one for 2009. Should I use the end-of-the-year statement for 2008 to calculate my RMD for both years?
Thanks, Joe Snyder
Permalink Submitted by Alan Spross on Wed, 2008-11-19 19:48
Joe.
No. The 2008 RMD will be based on the 12/31/07 balance and the 2009 RMD on the 12/31/08 balance.
While there has been talk of some possible relief from the generally higher 12/07 balances, nothing specific has emerged yet. Since you do not need the funds this year and you still have 4 months to go prior to the RBD, you can monitor developments to see if you will be allowed to use a lower balance than the 12/07 balance for this year’s RMD.
Of course, tax considerations should still affect your decision, as there will be two taxable distributions in 2009 if you wait. You can also split your 2008 RMD between 2008 and 2009 in any proportion if you wish.