Clarification on RMD withdraw date

[wyecrabber1]

Dear wife will be 72 on July 24, 2022. I've called two of our financial companies asking for the date she is required to take her RMDs. I've gotten two different answers. I searched this board -- and it's not clear.

Answer a) will be required to take a distribution in the year she turns 72, prior to April 1st.

Answer b) will be required to take a distribution in the year she turns 72 before December 31st.

Answer c) no distribution needed in 2022, distribution required in 2023 before December 31st.

Any one know of a website calculator where you input your date of birth and it tells you the date and amount of the distribution needed?

Thanks. Merry Christmas.

 

[Car-Guy]

Here's what it says from Schwab's website: (Blue text below)


"Your first RMD must be taken by 4/1 of the year after you turn 72. Subsequent RMDs must be taken by 12/31 of each year. If you don't take your RMD, you'll have to pay a penalty of 50% of the RMD amount."


The link below has basic RMD info and a link to Schwab's RMD calculator


https://www.schwab.com/ira/understand-iras/withdrawals/required-minimum-distributions

 

[TheWizard]

Right, the year after turning 72.

I turn 72 in February and will be taking RMDs monthly starting next month.

Doesn't make sense for most folks to delay RMDs unless still working for a salary...

 

[wyecrabber1]

Just to clarify;

The SECURE Act changed the age requirement from 70 ½ to 72, meaning anyone whose birthday falls on or after July 1, 2019 has until age 72 to take his/her first RMD.

Wife turns 72 on July 24,2022. She has as late as April 1 of the year following the year she turns 72 [2023] to take her first RMD. For each year thereafter, the RMD must be made annually by December 31st. If she delays her first RMD until the following year [2023, prior to April 1], she will need to take two RMDs in that year.

In order to avoid having to take two RMD distributions in 2023, my understanding is to take a distribution anytime in 2022 and a distribution in 2023 ... Plans are to take the distribution in January each year, pay the tax and re-invest the remaining.

 

[cathy63]

None of those choices are correct.

April 1 2023 for the first RMD based on the account value on 12/31/2021 and her age of 72.

December 31 2023 for the second RMD based on the account value on 12/31/2022 and her age of 73.

Here's the same answer from the IRS: https://www.irs.gov/retirement-plan...qs-regarding-required-minimum-distributions#3

If you don't want to have two RMDs hitting your tax return in 2023, then she can take the first one in 2022.

 

[TheWizard]

Sounds like an excellent idea, WC...

 

[MissMolly]

She can take her first RMD at any time during the year she turns 72 and no later than April 1 of the following year. If she delays until the following year she will be required to take two RMDs (one for the year she turned 72 and one for the current year). So her first can be before her actual birthday as long as it is in the year she turns 72.

 

[oldtimer]

She can take her first RMD at any time during the year she turns 72 and no later than April 1 of the following year. If she delays until the following year she will be required to take two RMDs (one for the year she turned 72 and one for the current year). So her first can be before her actual birthday as long as it is in the year she turns 72.

Yep, you can take your first RMD from January in the year you turn 72 until 4/1/year after turning 72. You can also take part of the 1st RMD in the year you turn 72 and the remainder of the 1st RMD in the first quarter of the year after you turn 72. You do not have to wait until you turn 72, unlike you must wait until you are at least 70.5 before taking a QCD.