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RMD Start date - checking


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 . . . Although, to avoid being taxed twice in the same year for 2 RMDs, the participant can elect to take their first RMD by December 31, 2025.  

As a practice, we inform RMD eligible participants that they may take their first RMD by December 31 of the year they attain RMD age to avoid doubling distributions in a single tax year and bumping up their tax liability.  The Required Beginning Date is a "not later than" date.

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12 hours ago, Jeff Hartmann said:

If participant born 4/11/1952 is terminated or was a 5%-owner,  his  Required Beginning Date is  April 1, 2026    (not 12/31/2025).

 

....  Jeff

It is actually 12/31/2025... 

4 out of 3 people struggle with math

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49 minutes ago, ratherbereading said:

It is actually 12/31/2025... 

It is actually 4/1/2026. 2025 is the first distribution calendar year, but the required beginning date is April 1 of the following calendar year. The definition of "required beginning date" is found in 1.401(a)(9)-2 Q&A-2 (which has not yet been updated for SECURE, let alone SECURE 2, so mentally substitute age 73 below)

Quote

Q-2. For purposes of section 401(a)(9)(C), what does the term required beginning date mean?

A-2. (a) Except as provided in paragraph (b) of this A-2 with respect to a 5-percent owner, as defined in paragraph (c) of this A-2, the term required beginning date means April 1 of the calendar year following the later of the calendar year in which the employee attains age 70½ or the calendar year in which the employee retires from employment with the employer maintaining the plan.

(b) In the case of an employee who is a 5-percent owner, the term required beginning date means April 1 of the calendar year following the calendar year in which the employee attains age 70½ .

 

Free advice is worth what you paid for it. Do not rely on the information provided in this post for any purpose, including (but not limited to): tax planning, compliance with ERISA or the IRC, investing or other forms of fortune-telling, bird identification, relationship advice, or spiritual guidance.

Corey B. Zeller, MSEA, CPC, QPA, QKA
Preferred Pension Planning Corp.
corey@pppc.co

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