3 IRA Tasks to Complete by the End of 2024

Monday, October 28, 2024

Sarah Brenner, JD
Director of Retirement Education

The year 2024 has flown by and the holidays season will soon be upon us. That means time is running out on year-end IRA deadlines. You will want to be sure to get the following three IRA-related tasks done sooner rather than later to avoid penalties and missed opportunities:

1.) Take your RMD. If you have a traditional IRA and turned age 74 or older this year, you will need to take a 2024 required minimum distribution (RMD) by the end of the year. If you turned 73 in 2024, you will have a little extra time to take your first RMD. Your deadline will be April 1, 2025. (But delaying your 2024 RMD into 2025 means you will have two RMDs due for 2025.) Those who must take an RMD for 2024 should not wait until the last minute. Many custodians have earlier internal deadlines to process these transactions, and waiting until the last minute can result in mistakes.

Many beneficiaries are required to take 2024 RMDs from inherited IRAs. If you inherited an IRA prior to 2020 or if you are an eligible designated beneficiary who inherited an IRA between 2020 and 2023, you will need to take an RMD for this year. Beneficiaries subject to the new 10-year payout rule under the SECURE Act catch a break. Due to all the confusion surrounding the 10-year rule, the IRS has said that a beneficiary subject to this rule is not required to take a 2024 RMD.

2.) Do a QCD. The holiday season is the time when many are feeling charitable. A good way to give if you have an IRA and are age 70 ½ or older is to do a qualified charitable distribution (QCD). This is a tax-free transfer directly from your IRA to the charity of your choice. The limit for 2024 is $105,000. A QCD can satisfy an RMD and is not included in modified adjusted gross income. There is no such thing as a “prior year QCD,” so if this strategy is of interest to you for this year, you will need to get it done by December 31, 2024.

3.) Convert to a Roth IRA. Tax rates are historically low, and those rates may not last much longer. This may be the ideal time for Roth IRA conversions. Time is running out though for 2024. The deadline for converting for this year is December 31, 2024.

Post Views: 3,035

Content Citation Guidelines

Below is the required verbiage that must be added to any re-branded piece from Ed Slott and Company, LLC or IRA Help, LLC. The verbiage must be used any time you take text from a piece and put it onto your own letterhead, within your newsletter, on your website, etc. Verbiage varies based on where you’re taking the content from.

Please be advised that prior to distributing re-branded content, you must send a proof to [email protected] for approval.

For white papers/other outflow pieces:

Copyright © [year of publication], [Ed Slott and Company, LLC or IRA Help, LLC – depending on what it says on the original piece] Reprinted with permission [Ed Slott and Company, LLC or IRA Help, LLC – depending on what it says on the original piece] takes no responsibility for the current accuracy of this information.

For charts:

Copyright © [year of publication], Ed Slott and Company, LLC Reprinted with permission Ed Slott and Company, LLC takes no responsibility for the current accuracy of this information.

For Slott Report articles:

Copyright © [year of article], Ed Slott and Company, LLC Reprinted from The Slott Report, [insert date of article], with permission. [Insert article URL] Ed Slott and Company, LLC takes no responsibility for the current accuracy of this article.

Please contact Matt Smith at [email protected] or (516) 536-8282 with any questions.