Understanding Required Minimum Distributions
Вставка
- Опубліковано 23 сер 2024
- Explanation of what you need to know about Required Minimum Distributions, or RMDs
Links in this video:
Retirement Planning Insights - www.tenonfinan...
Taxes in Retirement - / taxesinretirement
#RMD #RequiredMinimumDistribution #RequiredMinimumDistributions
DISCLAIMER: This video is only helpful hints and education. It is not specific tax, legal or investment advice. Before considering acting on anything you see in this video, first consult with your tax, legal or investment advisor. While the information expressed in this video is believed to be accurate, neither Andy Panko, CFP®, RICP®, EA nor Tenon Financial LLC make any guarantees to its accuracy.
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Really well done and without error. Just watched another video from an "expert" and immediately found two major errors (life expectancy table to use and aggregation rules of employer plans and IRAs). You're the best and I've subscribed. Thanks and great job!
Thanks Randy! I greatly appreciate the feedback and kind words!
I knew a bit of this information, and I just received notice from my account manager of my upcoming RMD. Your video was very helpful in deciphering the material I received.
Thanks! I'm glad you found it helpful
Excellent!! Thanks for posting.
Thanks, very clear explanation of RMD’s.
Thank you so much…This is the best one for sure very organized and clear information!👍👍👍
thank you!
Hey Andy thanks for the info, great presentation! Lots of really good information in there! Thanks for posting the video & I look forward to seeing you n your next one! Cheers!😎👍🏾👍🏾
Thank you very much. This is very helpful to me.
Got it!. I appreciate this video. Many thanks my friend
Thanks. Very informative.
Excellent job explaining!! 😊 Thank you
Very useful and clearly presented
Excellent explanation, thanks.
Thanks for the very useful tips.
Thank you! Clear info.
This is so useful info. Thank you.
Thank you for your informative video. I have subscribed to your channel and "Liked" the video as well. See below for my questions regarding IRA RMDs':
Today is Feb 29,2024. As of this writing, I am 72 years of age. I will turn 73 in a few short weeks on my birthday of April 5,2024. My spouse is 11 years younger than me. Her birthday is 07/22/62. My spouse is the sole beneficiary of my IRA. I am fully retired and have an IRA that has never had an RMD withdrawal.
My questions below are relative to my first RMD and also for RMD's for tax year 2023 and tax year 2024:
Question(s)
Since this will be my first RMD, will the first RMD be considered a tax year 2023 RMD ? or a tax year 2024 RMD ?
If my first RMD does indeed apply to take the year 2023, does that RMD need to occur prior to calendar date 4/1/24 ?
Do I need to take a separate RMD later in calendar year 2024 for tax year 2024?
If I do need to take a 2nd RMD in the calendar year 2024 as outlined above, does the tax year 2024 RMD need to be taken by April 1st of 2024 ? or anytime in the calendar year 2024?
Thank you in advance for clarifying.
Hi. Your first year RMD doesn't actually HAVE to be taken until before April 1 2025 (yes, 2025...April 1 of the year after you turn 73). You CAN take your first year RMD now, or you can delay it until early next year. BUt, if you delay it into early next year, you'll then have to take TWO RMDs next year; your delayed first year and then also your second year. As such, that could spike your 2025 income. So, if it's better for you to recognize the first year's RMD in 2024 instead of doubling up RMDs in 2025, it could make sense to take the first RMD this calendar year, as it will then be 2024 income. And then in 2025 you'll only have the one RMD (i.e. your second year RMD).
So, to answer your question if you turn 73 this year, you actually don't HAVE to take any distributions this year. But if you don't, you'll be doubling up distributions next year
Answered a lot of questions i had
Love all your videos, what is your favorite bread crumb?
Panko breadcrumbs, without a doubt
2 questions: 1. Is it $3k+ per year or per month? 2. You stated if I am still working at 72, I dont have to take an RMD out of my 401k? Bonus question/clarification: This is only for traditional accounts? No roth ira/roth 401k matches etc?
The RMD tables/formulas determine your RMD amount for the year. How you choose to take that amount during the year is up to you.
I believe the 401(k) RMD waiver if you're still working applies to the Roth portion of your 401(k), too.
I am watching this video in Feb 0f 2024. Have any regulations regarding the first RMD been changed? as in delayed for a year ?
The year at which you start has changed. If you're not already 72, then RMDs don't start until the year you turn 73 (it used to be 72) UNLESS you were born in 1960 or later, in which case RMDs don't need to start until the year you turn 75
So if your birthday is later (at end of the year) you must use your age that you will be at the end of the year for the calculation ? Not your present age?
That’s correct
I know the amount for the RMD. Does one just take a distribution or is there a form or process needed?
Depends on the custodian of the account. Some of them will let you request the distribution through their website, and they normally let you link up a bank account to your IRA so you can do a direct ACH transfer of the RMD/distribution directly to your bank account. Others may require you to manually or electronically send in a distribution request form. Either way, if you have an RMD you have to take for this year, look into this sooner rather than later as there are only 9 business days left in the year. Worst case, if your custodian requires you to go the manual form route, there may not be enough time left in the year for it to get processed. But if you can do the online distribution thing from their website, it should hopefully only take a few days all said and done. Regardless, start the process ASAP if you need the distribution to be done for 2022
@@RetirementPlanningEducation Wow. Thanks very much for the timely response! Zowee!
It's Fidelity 401K. I never switched to Roth. Not sure it matters either way in the long term.
Anyway, Found the right page and - it's done.
Thanks for the assistance. I am subscribed.
Thanks for this very informative video. If you start taking your RMD before the age of 72 , do you have to keep taking an RMD or can you start and stop (for tax purposes) until you are 72 when you are mandated to take them?
You can stop before you’re actually RMD age. Because distributions are completely voluntary before you’re actually RMD age
Thank you so much for great video, Andy! How do you pay tax out of your RMD?
You can have tax withheld from the distribution. Your account custodian will have a form or an online process to fill out when you request your RMD distribution, and there should an area to specify how much tax, if any, you want withheld and sent to the government.
@@RetirementPlanningEducation Thank you, Andy! Which is better/normal - For my custodian (Morgan Stanley) to withhold, or don't withhold any money for tax but let my CPA do my tax returns and deal with the tax?
@@yannip2083 It's typically better to withhold as opposed to not withhold anything and then just pay it all at the end of the year. You may end up with an underpayment penalty if you do that. It would be best to discuss this with your tax return prepare and let him or her do some projections and give you a recommendation of how much tax withholding, if any, you should make.
@@RetirementPlanningEducation Thank you so much, Andy, THE BEST!
Thanks for the video and I just subscribed to your channel. Question. Regarding RMD's calculating the total from all your accounts, do you have to also add to the total if you also have a Roth IRA in addition to my 40k1's and IRA RollOvers?
Thanks for the subscribe! You have to add together the totals of all of your traditional IRAs (including any SEP or SIMPLE IRAs you may have). And that collective pot of IRAs will have a total RMD amount that must be met from any one or any combination of those accounts.
Separately, EACH 401(k) you have will need to have its own RMD met from just itself. In other words, there is no aggregating or mixing or mingling of 401(k)s.
As for Roth IRAs, they don't have RMDs, assuming it's your own Roth IRA (inherited Roth IRAs are a different story). With that said, the value of your Roth IRAs does not get added to value of your traditional IRAs when determining the RMD amount from your traditional IRAs.
@@RetirementPlanningEducation Thank you ....
YOU DID NOT MENTIONED THE 457 ACCOUNT!!
I have 401K & 457 & I’m 71 & working & planning to retire at 72.6 … (no IRA account)….. how much or what percentage do I’ve to take out after 72?
Does a financial advisor take a percentage of my traditional IRA?
Depends on the nature of their service, how they determine their fee, and whether or not they manage your investments or just provide financial planning WITHOUT managing your investments. If they ARE managing your investments, they are almost certainly deducting some or all of their fee out of your IRA (and whatever other account they may be managing for you). But if they are NOT managing your investments and are only providing you financial planning, they shouldn't be deducting fees out of your investment accounts. Instead, they should be sending you a bill that you pay out of pocket through check, credit card, etc.
Question: If you perform an in kind RMD to a taxable brokerage account, is that RMD calculated in the combined income formula for social security benefits? Since no income was actually realized (but taxes were paid on the RMD), is that RMD no longer calculated in the combined income definition?
Even if the RMD is taken as a transfer of securities to your brokerage account, it's still considered income from a tax perspective. And therefore that income will still be included when determining your Combined Income for Social Security.
@@RetirementPlanningEducation Thank you so much for that answer. It was difficult to find any information on that. I appreciate your channel.
I’m 64 and 7 months old ,i’m planning to withdraw my entire IRA account.
Is it possible to do it w/o tax any tax problem or penalty.
Assuming the money in your IRA is all pre-tax, you’ll have to pay income tax on however much you distribute. But since you’re over 59 1/2, you won’t have the additional 10% early withdrawal penalty.
thanks so much for your video .If i am stiil working do you think that RMD waver applied it mean that i can wait until i quit job to withdraw RMD without penalty.now i am 72 i have 3000 usd in 401k and 5000usd rollover from previous company
waiting for your reply thanks
If the 401(k) is from the employer at which you're currently employed, it's possible you may be able to delay your RMDs from that account until you retire. You have to ask your employer to see if their 401(k) plan allows you to delay them, or if they require you to take RMDs even if still working. Even though the IRS would allow you to delay, it doesn't mean your specific 401(k) needs to allow you to delay.
As for any other pre-tax qualified accounts you have (such as IRAs or 401(k)s from previous employers), you can't delay those even if you're still working; RMDs will be needed from those
Which age does person born 08/03/1955 must take the first RMD? Thanks
If you're referring to one of your own accounts, it's the year you turn 73. If it's an account you inherited from someone else, then the answer is "it depends"
I only want to see the chart of what percent I must take of my balance. Please!
Schwab has a good and easy to use calculator: www.schwab.com/ira/understand-iras/ira-calculators/rmd
Google is your friend
uncle sam get his
Yes he does...yes he does.
He doesn't if you do this smartly or he gets a lot less than whatever you would have paid. Getting money out of traditional tax advantage account with paying lowest possible taxes depends on you and you and your actions
I am 72 and currently take a monthly salary from one of my IRAs with tax deductions. Does this monthly withdrawal apply as part of the RMD?
It sounds like you’re taking normal distributions, which would go toward meeting RMDs
Well done, even I understood it. But are you on the toilet…the think tank?
Hmm...recording a video from the toilet...definitely an interesting idea for future videos! 🚽
👍👍👍👍👍❤