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RMD Timing and Value

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ByWandering Bear

L1: RMD Timing and ValueI have a client whose birthday is 9/15/36.
That means his first required min. distributionhas to be done by4/1/08, right?
So if we process that on, say, 2/1/08, does that also mean we calculate the RMD based on his IRA balance as of 12/31/07? Then, his next RMD would be due by 4/1/09 based on 12/31/08 values, and so on?
Thanks ya”ll2007-09-10 13:13, By: Wandering Bear, IP: [65.15.67.147]

L2: RMD Timing and Value
>>Then, his next RMD would be due by 4/1/09 based on 12/31/08 values, and so on?Not even close. The extension to April only occurs in the first year. If you take the first distribution in April, the 2nd distribution must occur before 12/31 of the same year and subsequent distributions must also occur by 12/31 of each succeeding year.2007-09-10 14:33, By: Gfw, IP: [74.136.102.241]

L2: RMD Timing and ValueSo warn/advise him that he will be taxed on the 2 distributions in 2008. The first one (his initial one) is based upon the balance as of 12/31 of the year before he became 70 1/2 on 3/15/2007 (i.e. 12/31/2006), even though he chooses to delay it until 2008 ( < 4/1/2008) The 2nd distribution must be taken before 12/31/2008, based upon the balance as of 12/31/2007, andNOTreduced by the delayed first payment that was taken earlier in the year (2008) (per correction in next posting).2007-09-10 16:49, By: dlzallestaxes, IP: [151.197.168.215] L2: RMD Timing and Valuedlz, That year end adjustment was eliminated as a calculation simplification in the 2002 RMD ruling. If you take them both in the RBD year, the secondRMD that yearjust uses the actual FMV of the account on the prior 12/31 without adjustment. Of course, this adds an incremental amount to the total RMDs if the first RMD is deferred to the RBD year. This may be about as good as it gets when it comes to tax simplification!2007-09-10 21:09, By: Alan S., IP: [24.116.165.60] L2: RMD Timing and ValueWow. Clear, concise answers that even I can understand. Thanks, ya''ll.2007-09-11 06:41, By: Wandering Bear, IP: [65.15.67.147]

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