EDB – which Table I factor to use?
My understanding of stretch IRA rules is that, in calculating the first RMD on Table I, you use the bene’s age in the year after the year of death.
So, if Owner dies in 2021 at age 69, with a (non-spouse) EDB age 63 at the time, the first RMD, using the new tables and due 12/31/22, is calculated using a factor of 23.7 (which corresponds to age 64, the EDB’s age in the year of distribution.
If that is accurate, does it make any difference if the bene takes the first stretch RMD before or after their 64th birthday in 2022? Or do we always use their age as of 12/31 in the year of first distribution?
Thanks!
Permalink Submitted by Alan - IRA critic on Tue, 2022-02-01 16:14
Yes, 23.7 is the correct divisor if the beneficiary will be 64 at the end of 2022. The amount of the RMD does not change based on the date of distribution, although any distribution prior to 2022 cannot be credited against the 2022 beneficiary RMD. All age determinations in the RMD rules for owners and beneficiaries are made based on the age of the person on their birthday in the RMD distribution year, and using 12/31 as the date produces the same result. There are no RMD rules that change the RMD amount based on the actual date the distribution is made within the RMD distribution year or after the RMD distribution year in the case of a late RMD. This even holds true for decedents as they are assumed to have lived the entire year in the year of death.