RMD Factor Falls Below 1
We have a 88 year old client that has been taking non-spouse RMDs for 18 years. The SLE factor for 2025 is 0.08. Is it safe to assume that she must take the entire balance of the IRA this year; even if the acount is valued more than the actual RMD? Thank you.
Permalink Submitted by Alan - IRA critic on Tue, 2025-05-27 17:00
Yes, the final Regs include a requirement that the beneficiary must take a full distribution once the divisor drops to 1.0 or lower. This applies whether the beneficiary is using the owners age (ie. beneficiary is older), or their own age. Therefore, if the account gained enough in the current year and the divisor was 1.0 or slightly less, the total distribution could be more than the usually calculated RMD.
Note that all divisors are stated in one tenth increments (eg 12.7, 1.2, or .8) and therefore a divisor of .08 could not be correct. You probably meant .8.