What are required minimum distributions and how are they determined?
Beginning at age 70.5, you must begin to withdraw money from your retirement accounts every year. The amount is determined based on your life expectancy as contained in the IRS tables. Required minimum distributions are computed by dividing the account balance at year-end by the life expectancy factor. Assuming a husband and wife are about the same age, then this factor at age 70 is 27.4 years.
The first required minimum distribution must be withdrawn by April 1st of the year following the year that you turned 70 and a half. Subsequent required minimum distributions must be withdrawn by December 31st each year. Every year, your required minimum distribution will increase over your lifetime.
If you want an estimate of your required minimum distributions each year, let us do the math for you and help you develop a strategy to satisfy your required minimum distributions.
Wealth Wisdom Group
Our firm does not provide tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your Financial Representative for further information.
Wealth Wisdom Group. LLC
701 Foulk Road, Suite 2G
Wilmington, Delaware 19803