As 2019 is winding down, it is time again to remind our eligible clients to take their Required Minimum Distributions (RMD) by December 31, 2019. An RMD is a specific amount the federal government requires you to distribute from a retirement account after reaching the age of 70 ½. Retirement accounts include Traditional IRAs, Sep and Simple IRAs, as well as a qualified retirement plan where the participant has terminated employment. Inherited IRAs are also subject to RMDs. The amount required is determined by an IRS prescribed formula. If it is not taken by the deadline, the cost is a steep 50% of the amount not distributed and is taxed as a penalty.
If you have just turned 70 ½ in 2019, you have until April 1st of 2020 to take your distribution. If you wait until 2020, you will be required to take an additional distribution for the year 2020.
If you haven’t already, please contact your Financial Advisor today to discuss your options. Every individual situation is different and we want to help you to make the most out of your RMD.
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