24 Jan Strategies for taking your first RMD
Q. I am retired and turned 70 in October. I know I must start taking Required Minimum Distributions (RMDs) by April of the year after I turn 70 1/2, which would be 2019. My question: If I wait until March 2019 to take the first distribution, am I then required to take a second distribution in 2019 for tax year 2019? Or, can I make my first distribution in 2019 and then one every year thereafter?
A. Required Minimum Distribution rules for your first distribution can be tricky.
Because you would turn 70 1/2 in March 2018, you have two choices, said Bill Connington of Connington Wealth Management in Fairfield.
He said one option is to take two distributions in 2019.
“One would be in April of 2019 and a second distribution for 2019 by Dec. 31, and then one distribution each year going forward,” he said.
Or you can take a RMD in 2018 and then only one distribution in 2019, Connington said.
“You need to check with your tax accountant on the amount of the distribution and how it will affect your income tax-wise for that year,” he said.
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This post was first published in January 2018.NJMoneyHelp.com presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.