IRA Required Distributions

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Traditional IRA Accounts are tax deferred investments. Tax deferral cannot continue forever. At a certain point, Internal Revenue Code section 401(a)(9) requires distributions to begin.

On April 16, 2002 the IRS released final regulations which apply to QRP and Individual Retirement Account distributions.

The owner of a Roth account and his or her spouse beneficiary are not required to take distributions.

Non-spouse beneficiaries must take distributions. Distributions taken from a decedent?s traditional account by anyone are taxable (except for nondeductible contributions) as ordinary income. Capital gains treatment is not available. Such distributions are not subject to the 10% additional tax on early distributions. Spouses who rollover such distributions or treat the account as their own are not subject toincome taxes or penalties.

Traditional, SEP, SIMPLE, and Roth accounts are subject to the final distribution rules.

The final regulations apply to all Individual Retirement Account owners, regardless of their age.

The final regulations are mandatory for calculating all required distributions. This rule applies to both owners and beneficiaries.

Congress has suspended required distributions for both IRA owners and IRA beneficiaries for 2009. This is an optional provision, i.e. the IRA owner or beneficiary can still take distributions if they so choose.

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Qualified Charitable Distributions
Required Beginning Date
Distribution Deadlines
Distribution Periods for Accountholders
Recalculation and One-year Reduction
Required Distribution Calculations
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