A taxpayer reached 70 1/2 years old this year and he has to start making minimum withdrawal from his IRA accounts. He has 3 different IRA accounts. Can he calculate the minimum distribution amount of each of the 3 accounts and then make the total required withdrawal of all the 3 accounts from one account only? That would just make the process more simple.
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RMD from three IRA accounts
Yes, he can do that. It does make things a little less confusing for the > 70 1/2 taxpayer. Depending on the investment vehicle and the rate of return will have an effect on which account is drawn upon.
Some clients do have auto withdrawals from funds on a monthly, quarterly basis. Kind of like dollar cost averaging in reverse.
WE make a practice of providing an Excel worksheet we have developed showing the 12/31 balances, the age that the tp turns 70 1/2,( and then beyond) the factor from the table and then the calculated RMD. Even though some of the administrators provide a calculated RMD, it is convenient for the tp to have this info all on one sheet if there is more than one account.
We update this worksheet every year keeping a hard copy in our file and a file in the computer that we can access very quickly. -
Do it the easy way
Add the value all three accounts and then calculate the RMD from the total value. Then make the withdrawal from either just one account or two accounts or all three, but they don't have to be withdrawn proportionately from each.Comment
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