RMD’s
I have a client who has a Traditional IRA he hasn’t contributed to in years, a SEP IRA that the company has not contributed to in years and a Simple IRA where he is currently deferring and the company matches 2%.
He is subject to RMD’s.
Does he have to take prorata from each type of IRA, or can he take the RMD’s for the year from the Traditional?
Permalink Submitted by Alan - IRA critic on Mon, 2020-01-27 21:38
He can “aggregate” the RMDs for these accounts in any proportion he wishes from the accounts he wishes.
Permalink Submitted by Janis Sleeter on Tue, 2020-01-28 22:18
Is there any “offset” that he has to watch out for if he is making QCD’s from his traditional IRA?
Permalink Submitted by Alan - IRA critic on Tue, 2020-01-28 23:39
There is no offset other than the tax on the QCD amount, but there are timing issues. It would be simpler if he could take the entire QCD and the rest of the RMD from the TIRA, making sure the amount of QCDs can be completed before he distributes the rest of the RMD. Other combinations are possible, but this is the simplest to avoid making a timing error while making sure that all the QCD distributions are used to offset taxable RMDs..