# RMD Calculation

Here is what should be a fairly straight forward question, but
the answer to which is not so obvious. And maybe that is why my
tax accountant refuses to warrant any answer he provides.
I turned 70 1/2 in March 2015. According to IRS Pub 590-B, my
RMD factor for 2015 was 26.50. I understand that, and made the
appropriate withdrawals.
The question is whether the RMD factor for 2016 is 25.60 (as is
shown in Table 3) for age 71 1/2 or 25.50, which might be implied
by other text in IRS 590-B that suggests the initial factor minus
1.0.
The minus 1.0 factor is clear for an inherited IRA that I have,
but is not so obvious for a base IRA.
Regards, Dan
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It seemed clear to me...for a non-inherited IRA, the RMD factor is recalculated based on the new estimated life.
At least, unless I see a ruling that says otherwise.
-- Arthur L. Rubin, CRTP, AFSP Brea, CA
Arthur,
Thanks for confirming what I had assumed to be the proper way to handle the calculations. I built my Excel spreadsheets (both regular and inherited IRA) assuming that, and it was also confirmed by my IRA custodian. I just got concerned when a CA based tax accountant didn't want to give an answer and/or wouldn't guarantee the answer.
Regards, Dan
Dan:
FYI, I will turn 70 1/2 in Dec. 2016, so this year is my first RMD year.
My divisor is 27.4
Mel
Somebody wrote, above, "...other text in IRS 590-B that suggests the initial factor minus 1.0."
Where does that come from and what does it mean? I thought my life expectancy changed from year to year by something other that one year, considering that I'm a year older after a year has gone by...
Will the factor go all the way down to zero if I live long enough?
On Thu, 31 Mar 2016 16:50:10 EDT, lotax wrote:
The reduction by 1 each year is a provision unique for inherited IRAs. You use Table 1 for your age the year after the death that resulted in your inheritance, and then reduce by 1 each subsequent year. See Page 10 of IRS Pub 590-B for 2015. There are some other quirks for inherited IRAs that could also apply. For example if there is more than one beneficiary, you have to compute the RMD using the age of the oldest beneficiary.
Regards, Dan
P.S. Not a tax professional, but someone working through this for the first time this year.
On Wed, 30 Mar 2016 16:29:50 EDT, MZB wrote:
Mel, Because my birthday is later in the year, I didn't turn 70 1/2 until the next tax year (last year). But then my RMD factor became 26.50 for last year when I had to make my first RMD. I will be 72 this year. My inherited IRA is what was concerning me.
BTW, Alan M. from our other mutual group has been here in the past. And Bill A. can also be found in one of the PC groups even though he hasn't been active in our other group for some time since his surgery a few years back.
Regards, Dan

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