2002 Required Minimum Distribution

[Guest taj32z]

I have a participant that is over age 70 1/2 and is required to take minimum distributions from the plan. His wife died last year, and now he has named his two children as beneficiaries. For 2001 the minimum distribution was calculated with the Uniform Life Table. What table should be used for 2002 now that his wife has died and his children are the beneficiaries?

Thank you.

[jaemmons]

If the plan is using the new rules for 2001, then the distributions in subsequent years must be based upon his single life expectancy, recalculated every year. The contingent beneficiaries do not extend the distribution period, since the participant was already receiving MRD payments. However, if the plan is using the new rules effective for 2002, then you can argue that he could use the MDIB tables with his life exptcy and a fictional bene. 10 years younger.

The contingent beneficiaries come into play after the participant dies. At that point they can continue the MRD payments based upon their single life exptcy reduced by 1 each year (assuming they don't take the entire amount out within the 5 year period)

[Guest benji]

Newkirk provides both a booklet and Internet version of the new required mandatory distribution rules. Check out this link or call (518) 862-3200: http://www.newkirk.com/rdi.htm