December 9th, 2016 | Judy Chambers

Happy spending

If you are 70 ½ years of age and have a Retirement account, or an employer-sponsored retirement plan you are subject to withdraw a Required Minimum Distribution by the end of the year.

So if you are looking for some extra money and have not taken your Required Minimum Distribution this would be the perfect place to withdraw from.

Each year after 70 ½ you are required to take your Required Minimum Distribution. This can be taken any time during the year between January 1st and December 31st. You do not have to wait until the end of the year to withdraw your distribution. If you take the distribution at the beginning of the year you can hit all the after Holiday Sales.

Some helpful information for fulfilling your Required Minimum Distribution

  • If you have more than one retirement account; you must determine the Required Minimum Distribution separately for each IRA. You may total the sum and distribute that amount from any one or more of the retirement accounts.
  • You may always take out more than the Required Minimum Distribution. Any amount over the Required Minimum Distribution cannot be carried over for the following year.
  • If you are requesting a distribution of cash, please make sure funds are available and that you have a Federal Income Tax election on file prior to sending the request.
  • All Required Minimum Distributions will be reported on IRS Form 1099-R.
  • Contributions to the account must be discontinued for the year the participant turns age 70½ and for all subsequent years.
  • Required Minimum Distributions are not eligible for rollover into any other type of retirement account.
  • The consequence of not taking your Required Minimum Distribution is a penalty tax of 50%.

Please consult with your Advisor to make sure you have taken the required amount for the year.