403b RMD…
Client has a Beneficiary IRA, Traditional IRA and a 403b. I know the beneficiary RMD must be withdrawn from the beneficiary IRA. Is it the same with the 403b…does the client have to satisfy his 403b RMD from the 403b or can he co-mingle it with his IRA?
Permalink Submitted by Bernadette Strout on Mon, 2013-04-15 18:14
Your client needs to satisfy the 403B RMD from the 403B.For more information: http://www.irs.gov/Retirement-Plans/Retirement-Plans-FAQs-regarding-Required-Minimum-Distributions#return
Permalink Submitted by Alan - IRA critic on Mon, 2013-04-15 18:15
The 403b RMD cannot be aggregated with IRA RMDs, although if there was more than one 403b, the RMDs could be aggregated with each other. Also, note that if client had a 12/31/1986 403b balance, that balance is exempt from usual RMD rules and the RMD for that balance is not required until age 75.
Permalink Submitted by Wendy Mommaerts on Tue, 2013-04-16 13:58
Our client will be transferring 1 of 2 of his 403b accts into his traditional IRA. I am assuming that it will be ok to process this RMD from his traditional IRA?
Permalink Submitted by Alan - IRA critic on Tue, 2013-04-16 16:08
A 403b RMD must be taken from a 403b plan, not from an IRA. Due to the aggregation rules mentioned in prior post, client could satisfy both 403b RMDs from any combination of the two plans. However, the plan to be rolled over will probably want some documentation if client has already taken the total RMD from the other plan. Otherwise, they will require that the current RMD from the particular plan be distributed and not included in the IRA rollover. If an error is made and no RMD is distributed before the rollover, the RMD is still deemed to be satisfied, but then contributed to the IRA as an excess contribution. It would then be corrected like any other IRA excess contribution. Having two 403b plans and only rolling over one of them can result in some confusion due to the 403b aggregation rules.