Skipping RMD

[taxxcpa]

I'm confused with the rule on skipping the 2009 RMD from IRAs.
Does it mean the RMD based on Dec 2009 IRA value, or does it mean the 2009 withdrawal based on the Dec 31, 2008 IRA value?

[ChEAr$]

It is the latter

I'm confused with the rule on skipping the 2009 RMD from IRAs.
Does it mean the RMD based on Dec 2009 IRA value, or does it mean the 2009 withdrawal based on the Dec 31, 2008 IRA value?

i.e. the distribution required IN 2009.

theory is/was that will help the stock market.

[taxxcpa]

Unfortunately for me

i.e. the distribution required IN 2009.

theory is/was that will help the stock market.

I took a good share of my own RMD in Jan 2009. My wife took her full RMD also, so we lose out on most of that tax holiday it seems. I usually take the RMD Jan 2 and use the money mostly to pay down the mortgage on a rent house I own. I'm not sure how much damage I've done to myself from jumping the gun.

[Snaggletooth]

Banks

Real truth is this action allows banks and financial institutions to hold on to their money.

One of my gentle and naive clients thought the purpose was so the govt could actually help HIM.

[Bees Knees]

too bad

I took a good share of my own RMD in Jan 2009. My wife took her full RMD also, so we lose out on most of that tax holiday it seems. I usually take the RMD Jan 2 and use the money mostly to pay down the mortgage on a rent house I own. I'm not sure how much damage I've done to myself from jumping the gun.

TTB update on 12/23/2008 told you that you did not have to take RMD for 2009.

http://www.thetaxbook.com/view_update.asp?1=121

It pays to pay attention to those updates.

[AJsTax]

It does help

Real truth is this action allows banks and financial institutions to hold on to their money.

One of my gentle and naive clients thought the purpose was so the govt could actually help HIM.

many taxpayers, not just the banks and financial institutions. The RMD is figured on year old numbers and so many have lost so much in their fund, the thought was to give a year holiday so the fund can recover (hopefully) without having to take a RMD on a fund that is severely depleted already by the fall in values.

[Davc]

i.e. the distribution required IN 2009.

theory is/was that will help the stock market.

No, it's the distribution FOR 2009.

[ChEAr$]

that's exactly what I said

No, it's the distribution FOR 2009.

duh. it's the distributed required IN 2009 FOR 2009.

[Larmil]

duh. it's the distributed required IN 2009 FOR 2009.

What if it is distributed in 2010 for 2009?

[taxxcpa]

What is a 2009 distribution?

What if it is distributed in 2010 for 2009?

That is exactly what I can't understand even after reading the Tax Book update. One example mentions someone who turns 70 1/2 and it states that they do not have to take the distribution otherwise due by Apr 2010. There is no example for someone who turned 70 1/2 BEFORE 2008 or 2009.

I took my 2007 distribution in Jan 2008 and took my 2008 distribution of, for example, $ 100 in Jan 2009.

My question is: Assume that I have $5000in my IRA on Dec 31, 2009 and have only taken the $100 in Jan 2009 based on my 12-31-2008 balance. Assuming I have a 20 yr life expectancy, I would normally need to withdraw $ 250 some time in 2010.

Does the new law mean that I did NOT need to take the $ 100 I took in 2009 or does it mean I can skip the $ 250 based on my Dec 2009 balance?

[Larmil]

That is exactly what I can't understand even after reading the Tax Book update. One example mentions someone who turns 70 1/2 and it states that they do not have to take the distribution otherwise due by Apr 2010. There is no example for someone who turned 70 1/2 BEFORE 2008 or 2009.

I took my 2007 distribution in Jan 2008 and took my 2008 distribution of, for example, $ 100 in Jan 2009.

My question is: Assume that I have $5000in my IRA on Dec 31, 2009 and have only taken the $100 in Jan 2009 based on my 12-31-2008 balance. Assuming I have a 20 yr life expectancy, I would normally need to withdraw $ 250 some time in 2010.

Does the new law mean that I did NOT need to take the $ 100 I took in 2009 or does it mean I can skip the $ 250 based on my Dec 2009 balance?

I thought the rule was that after the first year you were required to take the RMD by Dec 31, of the year. Has that changed, or am I confused?

[Lion]

This Year

You take your RMD any time during the year up to and including 31 December. It's based on your balance the prior 31 December. Only the first year do you have an option to defer until the following April.

For 2009 only you can lower or skip your 2009 RMD (based on 31 December 2008 balances) to let your accounts recover a bit before depleting them any further if you can live without the money.

If you recently turned 70 1/2 and deferred your 2008 RMD (based on 31 December 2007) until 2009 under the first time rule and have both 2008 and 2009 RMDs to take this year, you still have to take your 2008 RMD, you can skip only your 2009 RMD.

[Davc]

duh. it's the distributed required IN 2009 FOR 2009.

Or in 2010 for 2009 but not in 2009 for 2008.