RMD question

[RayJJohnsonJr]

An employee (non-owner) turned 70 1/2 this year. Since he is still working, he does not have to take an RMD. However, he has a 410(k) account at a former employer. If he transfers his former employer 401(k) to his current employer 401(k) account can he avoid a RMD from the former employer 401(k) account this year? Next year?

Thank you!

[BG5150]

If he turned 70 1/2 this year, his RMD for 2011 is based on his account balance in the (old) plan as of 12/31/10.

Any distribution (from the old plan) in 2011, even if it was January 2 and before he was 70 1/2, would first have to be considered an RMD.

[masteff]

But he can avoid next year's MRD if he rolls before year end after taking the MRD for this year.

[RayJJohnsonJr]

Thanks y'all. I'll tell his to take his RMD and move the old 401(k) to his current 401(k) this year.

Thanks again!

[austin3515]

But he can avoid next year's MRD if he rolls before year end after taking the MRD for this year.

OMG that is so cool

I am such a loser...

[12AX7]

You lose a bet or something?

[austin3515]

Just that I find something "so cool" where if I told the story at a party, I'd be standing in a room by mysefl...

[12AX7]

I learned many years ago not to talk about what I do for a living at a party. If the discussion at a party should turn to the subject of 401 (k), I have to bite my tongue. It is not an invitation to discuss Code and Regs.

[austin3515]

Austin: What do you do?

Response: I develop web-applications to automate telecommunications background flux capacitators. What do you do?

Austin: I work with retirement plans.

REsponse: Oh, do you have any investment tips?

Austin: No, I handle the compliance./

REsponse: Oh. Well nice to meet you.

OK, not that bad, but pretty bad!

[12AX7]

I hear ya brother ! I once told a client about all the things we learn at ASPPA. Another mistake, because she 's been making fun of me for the past 10 years and doesn't let it go.

[masteff]

My strategy is to divert the conversation with "have you met my girlfriend, the flight attendant?" (true fact) Which hopefully leads into my Amsterdam anecdote and away from the pros and cons of regular vs Roth contributions.

[pmacduff]

I'm old enough that I remember when people would ask what I did & when I would say I was a "Pension Administrator" they would say, "oh - you're in insurance?"

I have found even with the masses more educated in the DC/401k arena nowadays if I say I work with 401(k) Plans they think that means I'm a 401(k) investment advisor and try to corner me on what funds they should be picking in their Plan at work.

I don't even try to explain anymore!

[ESOP Guy]

I jsut say I am a "specialized tax accountant".

They hear the words "tax" and "accountant" we get to move on to a different conversation.

Since I have been happily married for 25 years I no longer have to impress her with my job. It just has to pay the bills. So that helps.

[BG5150]

My line is "I work with 401(k) plans." That's usually enough to end the conversation, or, at least, to move it in another direction. Sometimes people will ask me what to do with their money, and I create a pregnant pause with " I really don't deal with the financial stuff. We just make sure the companies are following all the rules. It sounds a lot more exciting than it really is." Quiet, followed by "So, how 'bout them Giants..."

[imchipbrown]

I work at McDonald's always works.