RMD (retirement/rehire)
Good Afternoon
Interesting scenario – Assistance requested with the following:
individual worked for a large University – participating in a 401(k)/gov’t 457(b)
individual subsequently retired (handed in retirement papers)
individual turns 70.5 and then is rehired by the university as an employee (not an independent contractor)
questions
Does the participant have the ability to defer RMDs?
Thanks!
Permalink Submitted by Alan - IRA critic on Thu, 2014-04-24 23:35
Individual will have to depend on the plan administrator for that answer. The administrator may have more at risk than the individual if the plan fails to distribute RMDs that are required. There is no IRS provision that allows RMDs to stop once they are started, and then the employee returns to work, but in a case where the employee returns to work prior to the end of the first RMD distribution year, and RMDs never started, I would expect that the plan would not require RMDs to begin. Did he return to work before the end of that year that he reached 70.5?