Pre-1987 403(b) deferrals and MRD's

[Guest BruceM]

I have read that those who contributed to their 403(B) plans prior to 1987 may defer their MRD's until age 75, but there are rules associated with this, namely, if these funds are transferred to the individual's IRA that this option will be lost. Can anyone direct me to more detailed information?

Thanks

BruceM

[mbozek]

While there are plrs stating that taxpayers may defer pre 87 balances until age 75 it appears there is no express statutory requirement for distribution of pre 87 account balances since prior to 1986 there were no minimum distribution requirements for 403(B) annuities which are not qualified plans. 403(B) annuities are treated as annuity contracts under IRC 72. The 1986 tax reform act extended the minimum distribution requirements to the post 87 account balances. See Section 1852(a)(3)(A) of the 1986 Tax reform Act. Reg 1.403(B)-2 Q-3/a-3 states that the pre 87 balance must be distributed under the mdib rules in effect in on July 27 1987 interpreting reg. 1.401-1(B)(1)(i). My question is where is the statutory basis for subjecting pre 87 account balances to a mdib requirement?