>5% Owner, 401k and IRA RBD
Business owner (>5%) turned 70 1/2 in 2017. Has a Traditional IRA, and still is actively employed and in the company 401(k). All funds are pre-tax.
He took the first RMD from his IRA in 2017, but wants to wait until 2018 (before April 1), to take the first RMD from his 401(k).
*Is this an allowable strategy, taking the first IRA distribution in 2017, but waiting until 2018 for the first 401(k) distribution?
*Since the IRA RMD has been satisfied for 2017, the 2018 distribution is still considered his second distribution, correct?
*He would have to take the 2017 RMD and 2018 RMD before 12/31/18, correct?
Permalink Submitted by Alan - IRA critic on Thu, 2017-12-14 18:29
Yes, deferring the first RMD is a separate choice per account. Further, deferring the first RMD can be done partially as well as deferring the entire amount. All distributions up to the RBD are deemed to apply first to the prior year’s RMD, then to the current year. The 2018 RMD must be distributed by 12/31/2018 calculated using the actual account balance on 12/31/2017. There is no special tax reporting or break out of the RMD amounts by year on the 1040.