Required Minimum Distribution (RMD)FAQS                                                                                   ...
Required Minimum Distribution (RMD)FAQS                                                                                 Av...
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What is required min distribution for an ira 4088541883 san jose california aviva life and annuity

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What is required min distribution for an ira 4088541883 san jose california aviva life and annuity

  1. 1. Required Minimum Distribution (RMD)FAQS Aviva Life and Annuity Company www.avivausa.com What is a Required Minimum Distribution (RMD) for a Traditional IRA? An amount of money that the Internal Revenue Service requires a policy owner to withdraw from a Traditional IRA account by April 1 following the year in which the policy owner turns age 70 1/2. The policy owner must continue to take out the required amount each year thereafter. There are other quali ed accounts such as 403(b) plans or pension/pro t sharing plans that may also require an RMD at 70 1/2 if the owner is no longer working. For more information, please consult your tax advisor or call us at our Customer Service toll-free number: 1-888-ANNUITY (1 888 266 8489). Do I have to take an RMD every year? Yes. You will need to take your RMD each year by December 31. You may defer your rst RMD to April 1 of the year following the year in which you turned age 70 ½. All subsequent RMDs must by taken by December 31. I did not have to take an RMD in 2009. Do I have to take an RMD in 2010? Yes. The Worker, Retiree, and Employer Recovery Act waived the RMD for 2009. The waiver only applied to 2009, and was not extended to 2010. You will need to take your RMD by December 31, 2010. How is the RMD calculated? The RMD is calculated by dividing your IRA balance as of December 31 of the previous year by your life expectancy. The IRS provides a table of life expectancy factors to use in this calculation. The formula can be described as: Accumulated Value as December 31 ÷ IRS Determined Life Expectancy Factor = Required Minimum Distribution Do I need to calculate my RMD myself? No. Aviva will calculate your RMD for you for your contract(s) at Aviva. Do I have to request my RMD each year? You are required to take an RMD each year. Aviva can calculate and send your RMD to you automatically, if desired. The amount can be sent via a systematic withdrawal on a monthly, quarterly, semi-annual, or annual basis, depending on your preference. 11/10
  2. 2. Required Minimum Distribution (RMD)FAQS Aviva Life and Annuity Company www.avivausa.comHow do I request my RMD?If you would like us to send your RMD automatically each year, you may complete an RMD request form.Please indicate your desired frequency and date.What happens if I don’t take my RMD?If you do not meet the RMD, the IRS will impose a 50% tax on the amount you failed to take. Werecommend you consult a quali ed tax advisor regarding the options available to you, should you fail tomeet your RMD.Will you let the IRS know that I have met my RMD so that I am not penalized?Yes. The information is provided to the IRS on a tax form. The tax form is IRS Form 1099-R. We will maila copy of the form to you so that you can use the information to le your tax return. The form will bemailed no later than January 31.Will I be taxed on my RMD?The RMD is considered a taxable distribution. However, whether you will be taxed on the distributiondepends on your personal tax situation. Please talk with your tax advisor regarding any questions youmay have about reporting this income on your tax return.I have other IRAs. Do I have to take my RMD from this contract?You do not have to withdraw funds from this contract. However, you do have to withdraw the fundsfrom one or more of your IRA contracts before December 31. We recommend you consult your agentor a quali ed tax advisor regarding the advantages or disadvantages of taking your RMD from othercontracts. 11/10

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