A few months ago, I helped my elderly father to complete his 2013 IRA Minimum Required Distribution from his four (4) IRAs. We did this by closing one of the smaller IRA accounts. That account balance was just slightly greater than the calculations (from the sum of the end of year balances from all 4 IRA accounts) showed that he needed to withdraw for 2013.
I have just discovered that one of the three (3) remaining IRAs is actually not an IRA at all. It is a 403b. Does the 403b have separate Minimum Required Distribution requirements that I must still meet? Or does our overall withdrawal for 2013 cover both his IRAs and this 403b?
I have just discovered that one of the three (3) remaining IRAs is actually not an IRA at all. It is a 403b. Does the 403b have separate Minimum Required Distribution requirements that I must still meet? Or does our overall withdrawal for 2013 cover both his IRAs and this 403b?
Answer :
1 : When you turn 70 1/2, you must start taking distributions from your
403(b) plan. The amount of the required withdrawal depends on the size
of your 403(b) account and your age. The IRS publishes life expectancy
tables that are used to calculate the amount of your withdrawal. Even
though these withdrawals are required, you must still include them as
part of your taxable income. The RMD rules apply to all employer
sponsored retirement plans, including profit-sharing plans, 401(k)
plans, 403(b) plans, and 457(b) plans. If the 403(b) plan has separately
accounted and kept records for pre-1987 amounts, and is for the primary
purpose of providing retirement benefits, then the pre-1987 amounts
(excluding any earnings or gains on such amounts) are not subject to the
age 70½ RMD rules and are not used in calculating age 70½ RMDs from the
403(b) plan, and don't need to be distributed from the plan until
December 31 of the year in which a participant turns age 75 or, if
later, April 1 of the calendar year immediately following the calendar
year in which the participant retires.If the plan includes both pre-1987
and post 1987 amounts, for distributions of any amounts in excess of
the age 70½ RMDs, the excess is considered to be from the pre-1987
amounts. If records are not kept for pre-1987 amounts, the entire
account balance is subject to the age 70½ RMD rules of IRC.
2 : As mentioned above. You need to withdraw at least the required minimum distributio due for each of your tax-deferred accounts after age 70 1/2. Of course, you can always withdraw more money than the RMD amount, but then additional income taxes...Read More...
2 : As mentioned above. You need to withdraw at least the required minimum distributio due for each of your tax-deferred accounts after age 70 1/2. Of course, you can always withdraw more money than the RMD amount, but then additional income taxes...Read More...
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