The order of RMD vs Contributions to TIRA
I have a cousin who is single (widow) turning 74 this year and has been withdrawing TIRA RMDs since 2022. She got a part time job at a craft store earlier this year. She would like to contribute to her TIRA early next year for this year but her custodian said she must take her RMD first. She usually waits to do this until December. I looked in Pub 590-B but couldn’t find anything saying the RMD must be taken before a contribution is made. Can you speak to this?
Permalink Submitted by Alan - IRA critic on Sun, 2024-11-03 18:41
The RMD does not have to be completed before making a contribution. However, she should be aware that any deductible TIRA contributions made after 70.5 will result in an offset of such amounts for any QCDs made in that year or later. Therefore, if she may make future QCDs, she would be better off making a Roth contribution, if eligible.