Bene RMD not matching with contra firm

Submitted by Wendy Mommaerts on Mon, 2018-02-05 15:09

We have a client that our contra firm is coming up with a different 2018 RMD than what I am getting.

Deceased Date of birth: 6/20/1923
Deceased Date of death: 4/4/2014
Beneficiary birth date: 5/21/1977
Year End value: 12288.06

Relationship to deceased: grandson

I come up with a life expectancy factor of 42.6 with an RMD of $288.45
first year beneficiary was to begin taking RMD was 2015 with a life expectancy factor of 45.6 reducing by 1 each year after

Contra firm is coming up with an RMD amount of $293.74

I never had an issue with calculating Beneficiary RMD’s…what am I doing wrong?



Submitted by Alan - IRA critic on Mon, 2018-02-05 17:33

Your divisor is correct assuming client was sole beneficiary or created separate inherited IRA by 12/2015. If not the firm might be using the divisor of an older sibling. Other possibilities for the difference include using the wrong year end balance or simple division error. 

Submitted by David Mertz on Mon, 2018-02-05 18:27

Perhaps they are using a different year-end value.  12,288.06 / 293.74 = 41.833 which is not an even tenth of a year, so it can’t be a properly calculated RMD based on a year-end value of $12,288.06 no matter who the beneficiary is.

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