{"id":221,"date":"2020-01-21T17:04:28","date_gmt":"2020-01-21T17:04:28","guid":{"rendered":"http:\/\/www.weissthompson.com\/blog\/?p=221"},"modified":"2020-01-21T17:04:28","modified_gmt":"2020-01-21T17:04:28","slug":"the-new-rmd-rules","status":"publish","type":"post","link":"https:\/\/www.weissthompson.com\/blog\/index.php\/2020\/01\/21\/the-new-rmd-rules\/","title":{"rendered":"The New RMD Rules"},"content":{"rendered":"

In November 2019, before the Budget Bill was passed, the IRS increased life expectancy tables to more accurately reflect American\u2019s longevity. The adjustment was unrelated to the Budget Bill. Who knows if another change will come (it is under discussion), but there is no direct change as of now from the Budget Bill for the tables. Use\u00a0Pub. 590-B<\/a>\u00a0for life expectancy tables.<\/p>\n

The big law change that occurred in the Budget Bill was a change in the required minimum distribution rules from age 70 and \u00bd to age 72 for people turning 70 and \u00bd after 12\/31\/2019. Read on for the explanation.<\/p>\n

As to Required Minimum Distributions (RMD), if you were 70 and \u00bd before 1\/1\/2020 (born before 7\/1\/1949) nothing has changed. You must take your RMD for 2019 and 2020 and 2021 just like before the bill. As an example, Ralph turned 70 \u00bd on December 4, 2019. He was required to take his 1st<\/sup>\u00a0RMD by 12\/31\/2019 because he is under the old law. Under a special, one-time rule, he could delay that 1st<\/sup>\u00a0payment until 4\/1\/2020, but he would still be required to take his 2019 payment by 4\/1\/20, AND still required to take his 2020 payment by 12\/31\/2020, and so on. He is unaffected by the new age rule.<\/p>\n

If you were not 70 and \u00bd by 12\/31\/2019 then a new era has arrived for you. Your first RMD will not be required until the year you turn 72. And yes, you can delay the first one until April 1 of the year you turn 73, although you would be required to take both the distributions that year. If Ralph was born July 4, 1949, he was just shy of 70 and \u00bd on 12\/31\/19, so the new rules would apply to him. He will need to take his 1st<\/sup>\u00a0RMD in the year he turns 72, or 2021. That first RMD may be delayed until 4\/1\/2022, but he does still have to take a 2022 distribution by 12\/31\/2022 as well.<\/p>\n\n\n\n
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Birth date<\/strong><\/td>\nNormal First Required Payment Date<\/strong><\/td>\nSpecial extension1st payment option<\/strong><\/td>\nFuture payment date requirement<\/strong><\/td>\nComments<\/strong><\/td>\n<\/tr>\n
Before July 1, 1949<\/td>\n12\/31 of year turning 70, so if turning 70 in 2019, 12\/31\/19<\/td>\nApril 1 of year after turning 70 and \u00bd, so if in 2019, delay until 4\/1\/2020<\/td>\nThe year following 70 and \u00bd, so if turning 70 and \u00bd in 2019, by 12\/31\/2020<\/td>\nIf using the special extension date, 2020 will require 2 payments: 1 for 2019 and the normal 2020 payment<\/td>\n<\/tr>\n
After June 30, 1949<\/td>\n12\/31 of year turning 72, so if born in 1949 by 12\/31\/2021<\/td>\nApril 1 of year after turning 72, so if born in 1949 by 4\/1\/2022<\/td>\nThe year following turning 72, so if born in 1949, by 12\/31\/2022<\/td>\nIf using the special extension date, 2022 will require 2 payments: 1 for 2021 and the normal 2022 payment<\/td>\n<\/tr>\n
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