We answer some pretty complex IRA and retirement plan questions. Our newsletters and other Slott Report entries can get into the weeds on some tricky topics. The thing is, when you spend all your time in the deep end, it’s easy to forget there are new swimmers in the shallows, testing the waters for the first time.
Question:
Can you please clarify a question I have about whether I should take a Roth IRA withdrawal?
I am much older than age 59 ½, and my first Roth IRA was opened over 20 years ago. I now own a second Roth which holds recently converted funds from my 403(b) account. I am planning to make added Roth conversions over the next couple of years and pay the tax on these conversions. If I make a subsequent withdrawal from my Roth IRA, will it be tax- and penalty-free?
If you’re an IRA beneficiary subject to the 10-year payout period and would have had a 2024 required minimum distribution (RMD), you’re in luck. In IRS Notice 2024-35, issued yesterday (April 16), the IRS said it would excuse those RMDs.
You have carefully saved for retirement and now you have accumulated a substantial amount of funds in your IRA. At some point the funds that you have been putting away for years must come out. When you reach age 73 you must take a required minimum distribution (RMD) for that year and for every year thereafter.
QUESTION:
Dear IRA Help,
My mother passed away in April of 2023 and no required minimum distribution (RMD) was taken. The entire IRA account was paid out to the charity that was the beneficiary. Was there a requirement to take the RMD?
Joe
Imagine walking through a grocery store, intent on purchasing a specific item. As you turn down an aisle, little colorful tags proclaiming “Special Deal” and “Buy 1, Get 1” protrude from each shelf. In anticipation of your item being offered at a discounted price, you get a little bounce in your step.
If you exceeded the 2023 limit for 401(k) deferrals, time is of the essence to correct the error. If you don’t act quickly, the tax consequences can be serious.
The maximum amount of pre-tax and Roth contributions you could make for 2023 was $22,500 (plus $7,500 more if you were least age 50).
Question:
I have a general question regarding the 10-year time frame for emptying an inherited IRA. Your guidance says that the deadline is the END of the tenth year following death. In this specific situation, the death occurred July 9, 2020, so I believe the deadline is December 31, 2030, the end of the tenth year.
Markets continue to climb. That is good news for your retirement account. However, there is a downside. When you contribute to a traditional IRA or a pre-tax 401(k), you make a deal with Uncle Sam.
‘Tis the season for identifying and correcting excess IRA contributions. It seems as if every other recent inquiry is about this subject. To keep readers on the straight and narrow, here are ten details about excess IRA contributions and the correction process…
