I suppose one can take more than RMD....but never less. I know how much money I have in my IRA and I have a good idea about my life expectancy. I plan on taking more than required minimum.
Just a couple notes here. Since Secure 2.0 pushed the RMD age out to 73 if you were born before 1960 and 75 if you're 1960 or younger, the examples he has here have a different factor. Roth 401K's have no RMD. If your spouse and you are relatively the same age (within just a few years), you need to calculate the RMD for each 401K or IRA separately based on the age of the person who owns it. That means you can't just pull your total RMDs out of one account, you need to calculate your RMD's for each account and pull the distributions from each account.
What table would you use if you have 2 IRA accounts. One IRA has your spouse that is 12 years younger than you as the sole survivor, and another IRA has your spouse listed along with your child as another beneficiary?
At the 2 minute mark you said Roth accounts are subject to rmds. Please explain. Do I have to withdraw from my Roth just like my traditional iras? If so, how is it not taxed?
Great clarifying question. Not Roth IRAs but rather Roth 401ks. Roth IRAs do not have RMDs but a Roth 401k will. It will be tax free but will be a forced withdrawal nonetheless.
@@SafeguardWealthManagement Follow up question. Given that Roth 401(k) is subject to RMD, .... Is this potentially solved by rolling the Roth 401(k) to an individual Roth IRA? Is this an inherent advantage of an individual Roth IRA?
Looking for verification of the Distribution Factor (DF) for an Inherited IRA I received from my mom who passed away in 2010. I was 57 in the year of her passing. If I follow the video, I would use the Single Life Expectancy Table (SLET) for my age the following year (when I was 58). In 2011 the DF was 27.0 for age 58. So, fast forward to now in 2023 (12 years later). My 2023 DF = (27.0 - 12 ) or 15.0. However, the SLET has been updated by the IRS over that time. The 2022 version of the SLET has the DF for a 58 year old now as 28.9. Using that number my DF for 2023 would be (28.9 - 12) or 16.9. Which one is correct? Is there another answer?
What if you have TWO separate IRA accounts and you are required to take 4% and these accounts are with two different brokerage places. Do you take 2% from both ? Or 4% from just one of them ?
If both are traditional IRAs you can take solely from one due to something called RMD aggregation rules. This video explains this more thoroughly - ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-ry_O1Fumnws.html
Good catch. Not sure why this was off. Copied table from a different, typically reputable source. Lesson learned. Make your own tables. 🙂 Here are the charts direct from the Federal Register - www.federalregister.gov/documents/2020/11/12/2020-24723/updated-life-expectancy-and-distribution-period-tables-used-for-purposes-of-determining-minimum
It was the SECURE Act in 2019 (effective in 2020) rather than the tax cut of 2018. The 10 year rule only applies to inheritances after Jan 1st 2020, however. Inheritances before then are under the previous stretch rules.
The IRS has yet to update publications. So the up to date tables are located on the Federal Register - www.federalregister.gov/documents/2020/11/12/2020-24723/updated-life-expectancy-and-distribution-period-tables-used-for-purposes-of-determining-minimum
Yes. Thank you for pointing this out. Table was from copied from a normally reputable source. Should have made our own, our apologies. I will pin a comment with the correction. Here is the link to the to the proper tables - www.federalregister.gov/documents/2020/11/12/2020-24723/updated-life-expectancy-and-distribution-period-tables-used-for-purposes-of-determining-minimum
What I don't understand is if the inherited IRA with a balance of $478,000 only has to take out $16,149 and each year it increases by the 10th year the tax hit will be astronomical as the balance will be over $300,000 plus it will make that person be in a higher tax bracket. I think you take the balance and divide it by 10. That would result in a $43,000 withdrawal and each year that goes up so the 10th year is much more manageable from a tax perspective. Your welcome lol.
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?
What happens if your spouse and 3 children have a percentage share ? Scenario 1 spouse 40% children each 20%.Senario 2 spouse and children all receive 25%.
Can't believe gold diggers have a separate RMD table, that's more advantageous!! Ofcourse not everyone is a gold digger. Roth 401K gets counted too for RMDs. I read somewhere, Roth 401K to Roth IRA conversion may go away; especially if current BBB is approved as is by the senate, which is unlikely.
