403b rollover to IRA
74 yr old male is still working. He took an RMD from a small 403b from a previous employer and then tried to rollover to his IRA – he was doing this so he could aggregate his account values. The check didn’t come until after the New Year. How does he figure his rmd for 2023? Happy New Year and Thanks
Permalink Submitted by Alan - IRA critic on Wed, 2023-01-04 20:41
An RMD is not eligible for rollover and the still working exception does not apply to former employer plans. If this distribution is rolled over it will become an excess IRA contribution. The 2023 IRA RMD RMD is based on the actual 12/31/2022 IRA value whether it includes an excess contribution or not. Further, if the 403b RMD was not distributed by year end generating a 1099R, that RMD will be delinquent, although because 403b RMDs can be aggregated, the RMD might have been completed by a previous distribution from any 403b.
Permalink Submitted by Stephen Hodson on Mon, 2023-01-09 16:18
The RMD is not part of the rollover. He is currently working for another non-profit so he doesn’t have to take a distribution from his current employer’s 403b. The RMD was from a previous employer’s 403b. He took the distribution, now he wants to rollover the balance of his former employer’s 403b to a traditional IRA. He requested that from the former employer’s 403b. The check was cut in December of 2022, but wasn’t received until after the first of the year. because the client was travelling. How does he calculate RMD for 2023?
Permalink Submitted by Alan - IRA critic on Mon, 2023-01-09 16:53
The IRA 12/31/2022 balance must be increased by the amount rolled over from the 403b even though the rollover contribution was received in 2023.
Permalink Submitted by Stephen Hodson on Mon, 2023-01-09 18:47
Thanks very much.