Proposed new IRS RMD Tables
The final Regs for the new tables are due to be published in about a week.
Unfortunately, the applicable effective date has been pushed back to 1/1/2022 meaning that 2021 RMDs must be calculated using the present tables.
- I had actually looked the day before and not seen an update.
- If I may ask a follow up question about this, I re-read the IRS instructions and wondering if I mis-read something.
- Mother passed in 2019, pre-SECURE Act.
- My brother and I were 50% / 50% beneficiaries. The Inherited IRAs were set up properly.
- I understand the basic calc of using the Single Life table, finding initial divisor based on beneficiary’s age in year following death, then subtracting 1 for each subsequent year.
- However, there’s a line in there about “Use oldest age of multiple beneficiaries”
- I am the older of the brothers, by a few years. Does this mean my brother also has to use my divisor, or do I have one and he has his own?
- Thanks…
- You brother would only use your age and divisor if the IRA was not split into separate inherited IRAs for each of you. By splitting it into separate inherited IRAs by the December 31, 2020 deadline for doing so in this case, your separate ages are used. See “Separate accounts” on page 12 of 2019 IRS Pub 590-B:
- https://www.irs.gov/publications/p590b#en_US_2019_publink1000230796
- Note that due to the new tables adopted starting in 2022, for that year you would have to “reset” your divisor to reflect those new tables. To do that, you would need to look up the divisor in the new tables for the age you attained in 2020, and reduce that divisor by 2.0 (for 2021 and 2022). For each year after 2022 you would continue to reduce your 2022 divisor by 1.0 for each succeeding year.
- Since the new table is not effective for 2021, your 2021 beneficiary RMD would be determined from the current table using your age in 2020, and you would reduce that divisor by 1.0 for your 2021 beneficiary RMD. Your brother would do the same using his age under the separate account rules.
Roger on using the old table’s “starting divisor” and subtracting 1 for the 2021 RMD calc, then finding the correct new “starting divisor” under the new table and subtracting 2 for the 2022 RMD. Thanks again…appreciate all you do here.
Permalink Submitted by riiupw afrass on Mon, 2020-11-09 20:43
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