Post 70 1/2 Beginning dates for rollovers mid year from 401k/403b to IRA
If a currently employed person older than 70 1/2 does a mid year rollover from a 401k/403b to and IRA, when doe he or she have to take the first RMD fro the IRA? Say 6/16 rollover. I understand it to be in 2017 based on the 12/16 IRA value because there was no money in the IRA 12/15. Marc Gillespie
Permalink Submitted by Alan - IRA critic on Tue, 2016-09-20 18:47
That is correct. If the employee retires before the end of 2016 or was a 5% owner, then 2016 would be an RMD distribution year and the plan RMD could not be included in the rollover. If it was, the plan RMD was satisfied but an excess IRA contribution was made and must be removed from the IRA. IRA RMDs begin in 2017 as you expected.