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How to manage RMDís
Old 10-22-2023, 07:53 PM   #1
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How to manage RMDís

For those who donít need RMDís to cover operational and occasional capital/lumpy expenses what do you do with them?

Iím pondering converting them to Roth, less tax, so if we need them later or leave them to kids they will be tax free. Is this reasonable? I realize this is a first world problemÖbut still a problem.
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Old 10-22-2023, 08:07 PM   #2
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You can’t convert an RMD to a Roth.
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Old 10-22-2023, 08:11 PM   #3
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Might check this out.
https://www.investopedia.com/ask/ans...d-reinvest.asp
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Old 10-22-2023, 08:14 PM   #4
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We plan to utilize Qualified Charitable Contributions (QCD) for most or all of our RMD if needed.
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Old 10-22-2023, 08:16 PM   #5
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The OP needs earned income, RMD is not earned and can only then invest $7500 into the Roth.
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Old 10-22-2023, 08:16 PM   #6
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Reinvest in a taxable account.
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Old 10-22-2023, 08:20 PM   #7
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+1
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Old 10-22-2023, 08:21 PM   #8
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Car-guy,
Thank you for the link. Very helpful.
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Old 10-22-2023, 09:49 PM   #9
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Car-guy,
Thank you for the link. Very helpful.
From that link, "The Internal Revenue Service (IRS) requires that you have enough earned income to cover your Roth IRA contribution for the yearóbut the actual source of your contribution need not be directly from a paycheck."
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Old 11-18-2023, 08:42 AM   #10
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Question about an annuity and RMD's. I'm 67 and I'll have to start taking RMD's in about 5 years. If I buy a 10 year annuity in the next few months, in general, are there government laws/provisions with annuities to allow RMD's without taking a penalty? Or is that dependent on the actual annuity provisions/rules?

I'm trying to decide whether I want to roll over an annuity that is maturing soon over to a new annuity.
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Old 11-18-2023, 11:07 AM   #11
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We plan to utilize Qualified Charitable Contributions (QCD) for most or all of our RMD if needed.
We do this every year, make gifts to charities from our IRAs and then we have very little RMDs to take.
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Old 11-18-2023, 11:09 AM   #12
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Reinvest in a taxable account.
Agree
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Old 11-18-2023, 11:14 AM   #13
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Quote:
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Question about an annuity and RMD's. I'm 67 and I'll have to start taking RMD's in about 5 years. If I buy a 10 year annuity in the next few months, in general, are there government laws/provisions with annuities to allow RMD's without taking a penalty? Or is that dependent on the actual annuity provisions/rules?

I'm trying to decide whether I want to roll over an annuity that is maturing soon over to a new annuity.
It's complicated. This page may get you started.

Annuity Inside an IRA: Know the Rules
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Old 11-20-2023, 09:12 AM   #14
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In the past it has been going into MM funds. This year we have been reinvesting our RMDs into CDs. Not sure for next year.

Cheers!
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Old 11-20-2023, 11:41 AM   #15
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QCD or just reinvest (after paying taxes) in a taxable account. Or BTD
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Old 11-20-2023, 05:10 PM   #16
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We do this every year, make gifts to charities from our IRAs and then we have very little RMDs to take.
Another advantage of QCDs - amounts donated via QCD do not show up in your MAGI. If you are getting close to an IRMAA threshold, using QCDs is a good way to give yourself some breathing room.
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Old 11-20-2023, 05:14 PM   #17
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QCD or just reinvest (after paying taxes) in a taxable account. Or BTD
Those are the only options for anyone without earned income AFAIK.
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Old 11-20-2023, 07:00 PM   #18
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My RMDs are either used in lieu of estimated federal taxes or in lieu of charitable giving (
QCDs). Just today I took my RMD for 2023 from my 401k with 100% federal withholding.
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