Required beginning date

Also found in: Acronyms.

Required Beginning Date

The date by which an IRA must begin distributing payments to the annuitant. Under most circumstances, the date is April 1 of the year following the time that the annuitant turns 70.5. Occasionally, the required beginning date is postponed until the date of retirement, but this is not allowed in situations in which the annuitant owns 5% or more of the company sponsoring the IRA. The amount distributed on the required beginning date may or may not be taxable, depending on the type of IRA. See also: Minimum required distribution.

Required beginning date (RBD).

Your required beginning date is the date by which you must take your first minimum required distribution from retirement savings plans that require distributions.

For an individual retirement account (IRA), it's April 1 of the year following the year you turn 70 1/2. For a 401(k), it's either the April 1 of the year following the year you turn 70 1/2 or the April 1 following the year you retire, unless you own 5% or more of the company sponsoring the plan. If that's the case, your deadline is April 1 of the year after the year you turn 70 1/2.

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In this scenario, J has elected the maximum deferral period consistent with the required beginning date for minimum distributions.
For Roth IRAs, the IRA owner is treated as having died before the individual's required beginning date.
It is important to note that the election must be made by the required beginning date, and once chosen it is irrevocable.
For each calendar year, beginning with the required beginning date, the minimum distribution is calculated by dividing the December 31 account balance (from the preceding year) by the remaining life expectancy of the account owner or, in some cases, the joint life expectancy of the owner and the designated beneficiary.
The Required Beginning Date (RBD) is April 1 of the year after the taxpayer attains age 70.
They repeal the prior rule that taxpayers designate a beneficiary by the required beginning date.
Under the new proposed regulations, IRA owners can change beneficiaries after the required beginning date generally without affecting the MRD or the ability for beneficiaries to "stretch" the IRA.
The designated beneficiary is determined as of the owner's required beginning date (RBD) for taking distributions--April 1 of the year after the year in which the owner turns age 70 1/2.
Previously, IRS proposed regulations concerning beneficiary selection and required minimum distributions (RMDs) made it necessary for pre-retirees and retirees to make certain decisions by their required beginning date (RBD)(2), concerning passing retirement savings on to their beneficiaries.
This allows: the employee to change designated beneficiaries after the required beginning date without increasing the RMD; and the beneficiary to be changed after the employee's death, such as a beneficiary disclaiming or cashing out.
The two sets of minimum distribution rules stipulate a required beginning date (RBD) for distributions.