60 Day Rollover Rule Different Calendar Years
Account holder is age 70 in 2017. Does not turn 70 1/2 until 2018. Account holder would like to take a distribution in mid-December 2017, with the ability to do a 60-day rollover.
*How is the 2017 distribution accounted for if the distribution is made in 2017, but not rolled back over until 2018?
*The distribution was in 2017, when the client was 70, but would be rolled back over into the IRA in 2018, the year when the account holder turns 70 1/2. Does the account holder need to satisfy her RMD for 2018 before the amount that was distributed in 2017 can be rolled back over into the IRA (within the 60 day period)? Or, since the account holder is rolling over a distribution that occurred in the prior year, before she turned 70 1/2, does that not apply?
Permalink Submitted by Alan - IRA critic on Thu, 2017-12-07 00:56
The distribution is not an RMD because it was distributed prior to year 70.5. Therefore, it can be rolled over within 60 days of the distribution even if the 60 days runs into 2018. If the distribution was done in 2018, then it is deemed to apply to the RMD and RMDs cannot be rolled over. While not related to RMDs, the account holder is still subject to the one rollover limitation within a 12 month period.