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
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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…
Question:
Hi,
My last remaining parent, my mother, passed away in May 2017, and my younger brother and I inherited her IRA (equally split into inherited IRA accounts). We were of the understanding we could handle required minimum distributions (RMDs) via the “stretch IRA” method (RMDs spread out over our expected lifetime). The new laws that went into place in 2020 and 2022 have us wondering if we must change what we are doing. Can you please help us with this question?
Previous Slott Report articles have covered the new SECURE 2.0 provision allowing 529 funds to be rolled over to Roth IRAs. We’ve reported that there are several unanswered questions concerning this new rollover opportunity. And we’ve discussed the ability to do two rollovers in 2024 – one for 2023 if completed by April 15 and a second by December 31.
You might be thinking about contributing to a Roth IRA. One big hurdle to making these contributions is the fact that there are income limits that make high income individuals ineligible. For 2024, the phase out range for eligibility for Roth IRA contribution is between $230,000 - $240,000 for those who are married filing jointly and between $146,000 - $161,000 for single filers.
