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Over 70½? Don’t Forget to Take Your Required Minimum Distributions

RMD

Did you celebrate your 70½th birthday in 2014? Do you have a traditional or rollover IRA? If both answers are yes, the deadline for taking the initial required minimum distribution from your retirement account is April 1, 2015.

Required minimum distributions are the smallest amount you can withdraw from your account to avoid penalties, and your 70½th birthday is the triggering start date. That’s defined as six months after your 70th birthday.

As an example, if your actual birthday was in July 2014, you’ll turn 70½ in January 2015. That means you don’t have to take a minimum distribution for 2014. Instead, you’re required to take your first minimum distribution no later than April 1, 2016. After the first distribution, you must complete each annual withdrawal by December 31.

Note that you may want to take your initial distribution by December 31 (instead of the following April) to avoid two withdrawals in a single year.

For assistance with this or other tax or accounting matters please contact us at 201-947-8081 or 646-688-2807, or email us at info@bergencountycpa.com.

 

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