Lastly, a surviving spouse can defer the minimum required distributions
until December 31 of the year in which the deceased spouse would have attained the age of 701/2.
However, several of our long-service professors have contacted us, inquiring about the possibility of amending our 401(a) plan to permit minimum required distributions
(MRDs) from that plan while the professors are still employed.
In a basic example concerning retirement accounts, if a child's residuary trust is the designated beneficiary of a decedent's retirement plan, the child has the right to stretch the minimum required distributions
from the IRA over his or her life expectancy.
The decedent was past the age of 70 A1/2 prior to his death, and had begun receiving minimum required distributions
from the IRA.
Alternatively, a discretionary or "accumulation" trust also provides asset protection while also allowing the trustee discretion in making minimum required distributions
Due to the state of the economy in 2009, the provisions mandating RMDs from traditional IRAs and pension plans were suspended; it is important to keep this in mind when considering the following example involving minimum required distributions
and a recharacterization.
Not only must longevity be taken into consideration, but both minimum required distributions
(MRDs) and unrequired distributions (monies needed to sustain your lifestyle) are important factors.
If funds are left to accumulate after age 70V, the 50 percent excise tax on undistributed minimum required distributions
must be avoided.
If funds are left to accumulate after age 70 1/2, the 50% excise tax on undistributed minimum required distributions
must be avoided.
By taking more than the minimum required distributions
from an IRA, the beneficiary will be wasting the years of tax-free compounding that the IRA would generate.
Minimum required distributions
("MRDs") are not required for any retirement accounts for 2009 pursuant to a newly enacted law.
What's more, after age 70 1/2 you must take minimum required distributions
(MRDs) from your IRA, even if you don't need the money.