There are many items to keep in mind regarding required minimum distributions (RMDs) in your IRA. These FAQs answer questions you may have before taking RMDs. The following information applies to traditional, SEP, and SIMPLE IRAs.

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Required Minimum Distributions
Frequently Asked Questions
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1. What is a Required Minimum Distribution?
If your spouse is not your sole beneficiary, or is
not more than 10 years younger, use the Uniform
Lifetime Table.
A Required Minimum Distribution (RMD) is
the amount required to be withdrawn from an
individual’s retirement account every year, once the
If you are the beneficiary of the account, use the
individual reaches age 70 ½ years of age, or retires,
Single Life Expectancy Table.
whichever is later. If the retirement account is an
IRA, or the individual is a 5% owner of the business 5. Can an RMD be taken from one account instead of
that sponsors the retirement plan, the individual
multiple accounts?
must begin taking RMDs at age 70 ½, even if the
individual has not retired.
Although RMDs must be calculated for each IRA
owned, the total amount may be withdrawn from
2. Which retirement accounts require minimum
one or more of the IRAs. RMDs for Individual(k)
distributions?
accounts must be taken separately.
The rules of RMDs apply to:
•
•
•
•
Traditional IRAs
Individual(k) accounts
SEP accounts
SIMPLE accounts
The rules also apply to Individual(k)s with Roth
option, but do not apply to Roth IRAs.
3. When do I have to take my first RMD?
The first RMD must be taken by April 1st of the
year following the year you reach age 70 ½. All
following RMDs must be taken by December 31 of
the year.
4. How is an RMD amount calculated?
The RMD is calculated for each account by dividing
the balance of the account on December 31 of the
year prior by the life expectancy factor published
in IRS Publication 590, Individual Retirement
Arrangements.
If your spouse is your sole beneficiary, or your
spouse is more than 10 years younger, use the
Joint and Last Survivor Table.
Entrust does not promote any investments. Rather, Entrust provides the
administration, information, and tools to make self-direction straightforward and
compliant. We help you get started quickly and stay with you every step of the way.
© 2013 The Entrust Group, Inc. All rights reserved.
6. May I withdraw more than the RMD?
Yes.
7. If I miss taking an RMD in time, what will happen?
Should you fail to take an RMD, or fail to take the
full amount of an RMD, the amount not withdrawn
will be subject to a 50% tax. You must file Form
5329, Additional Taxes on Qualified Plans (Including
IRAs) and Other Tax-Favored Accounts, along with
your federal tax return for the year in which the
RMD was not taken.
8. Is it possible to have the penalty for not taking an
RMD waived?
It is possible to have the penalty waived if you
can successfully establish that the shortfall in
distribution was cause of a reasonable error and
that reasonable steps are being taken to remedy
the shortfall. You must file Form 5329 with an
attached letter of explanation.
9. Can an excess distribution apply to a future year?
No.
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10. How is an RMD taxed?
You are taxed at your income tax rate on the
amount of the withdrawn RMD. If, however, the
RMD is a return of basis or is a qualified Roth IRA
distribution, it is tax-free.
11. Can an RMD be rolled over into another taxdeferred account?
No.
12. If an employee has reached age 70 ½ and is
receiving RMDs, does an employer still need to
make plan contributions for that employee?
Yes, the employer must continue to make
contributions for the employee.
Additional Resources
IRS.gov
IRS Publication 560
IRS Publcation 590
RMD Comparison Chart
The Entrust Learning Center
Entrust does not promote any investments. Rather, Entrust provides the
administration, information, and tools to make self-direction straightforward and
compliant. We help you get started quickly and stay with you every step of the way.
© 2013 The Entrust Group, Inc. All rights reserved.
www.TheEntrustGroup.com