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Member |
Yes, and my professional tax software is using the old tables, hasn't updated as yet. So, I'm having to override their calculation using the new table numbers, A serious PITA which I have communicated to them very clearly. Here is a link to the current tables: Reg 1.401(a)(9)-9 Place your clothes and weapons where you can find them in the dark. “If in winning a race, you lose the respect of your fellow competitors, then you have won nothing” - Paul Elvstrom "The Great Dane" 1928 - 2016 | |||
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| Member |
Nobody should let your IRA custodian do the calculation without you checking them. And further I am unsure what statue or regulation has them have this obligation, I'm unaware of it and mine has certainly never officially communicated to me about it. Its incredibly easy to confirm the amount, YE balance and factor from the IRS and away you go. “So in war, the way is to avoid what is strong, and strike at what is weak.” | |||
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Nullus Anxietas |
If I can't trust the guy that manages our retirement investments to get something that simple right, I certainly can't trust him to manage the investments, themselves  It's moot, in our case, anyway. Our distribution already exceeds what would be our RMD next year. "America is at that awkward stage. It's too late to work within the system,,,, but too early to shoot the bastards." -- Claire Wolfe "If we let things terrify us, life will not be worth living." -- Seneca the Younger, Roman Stoic philosopher | |||
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| Member |
Yes, the onus is on the account owner, PERIOD! If you are lucky, your investment advisor will escort you through it. But, in my experience, they don't. It's on you! Don't forget to do it, the penalty is 50 percent, waived if you have a reasonable cause but not if you are a repeat offender. Place your clothes and weapons where you can find them in the dark. “If in winning a race, you lose the respect of your fellow competitors, then you have won nothing” - Paul Elvstrom "The Great Dane" 1928 - 2016 | |||
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His Royal Hiney |
For one, it's not like you need to understand rocket science telemetry calculations in order to calculate the RMD for the accounts you own. For two, the IRS says it's the owner's responsibility. From the IRS.gov: "Who calculates the amount of the RMD? Although the IRA custodian or retirement plan administrator may calculate the RMD, the IRA or retirement plan account owner is ultimately responsible for calculating the amount of the RMD." Link "It did not really matter what we expected from life, but rather what life expected from us. We needed to stop asking about the meaning of life, and instead to think of ourselves as those who were being questioned by life – daily and hourly. Our answer must consist not in talk and meditation, but in right action and in right conduct. Life ultimately means taking the responsibility to find the right answer to its problems and to fulfill the tasks which it constantly sets for each individual." Viktor Frankl, Man's Search for Meaning, 1946. | |||
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| His Royal Hiney |
I didn't see anyone answer your question. You have to take RMDs beginning at age 72. There's a special rule for the first time you take RMD in that you can delay taking the first RMD by April 1 of the year after you reach age 72. But you'll then have to take two RMDs that first year. The amount of RMD you have to take in any year is based on the ending balance of your tax deferred accounts of the previous year. So if you need to take an RMD in 2022, you need to look at your balance statements as of Dec 31, 2021. RMDs for the year 2023 will be based on Dec 31, 2022 balances and so on. "It did not really matter what we expected from life, but rather what life expected from us. We needed to stop asking about the meaning of life, and instead to think of ourselves as those who were being questioned by life – daily and hourly. Our answer must consist not in talk and meditation, but in right action and in right conduct. Life ultimately means taking the responsibility to find the right answer to its problems and to fulfill the tasks which it constantly sets for each individual." Viktor Frankl, Man's Search for Meaning, 1946. | |||
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| A teetotaling beer aficionado  |
For one, it's not like you need to understand rocket science telemetry calculations in order to calculate the RMD for the accounts you own. For two, the IRS says it's the owner's responsibility. From the IRS.gov: "Who calculates the amount of the RMD? Although the IRA custodian or retirement plan administrator may calculate the RMD, the IRA or retirement plan account owner is ultimately responsible for calculating the amount of the RMD." ---------------- Yes that is true. But we (wife and I) get a missive from Fidelity each tax year with their calculations. I double check it and it's always spot on. There's not some dude sitting in a little office in the basement at Fidelity doing this. It's all computer generated. They know your end of year balance and your age so it's a pretty uncomplex computer program. I actually withdraw a bit more. Usually round up to the nearest $1000. I must say though, I've been taking this once a year withdrawal since I turned 72 and did some voluntary withdrawals prior to that. My account balance is still about 35% higher then when I turned 72, the last week notwithstanding. I guess I should be taking more. Men fight for liberty and win it with hard knocks. Their children, brought up easy, let it slip away again, poor fools. And their grandchildren are once more slaves. -D.H. Lawrence | |||
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| Member |
So life expectancy of a 75 year old grew 2+ years ? But CNN told me all trump killed all the olds with the rona ! Seems somebody is not being accurate. And I think I know who… | |||
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| Bookers Bourbon and a good cigar  |
Jebus on a pogo stick, this ain't that hard. Pretend you have 2 separate IRA accounts (1 in Schwab and 1 in Fidelity). You get a statement from FIRM A, stating your 12/31/2021 balance is $150,000. You get a statement from FIRM B showing a balance of $150,000. Your end of year balance in your combined IRA accounts is $300,000. You divide $300000 by your "Distribution Period" (Pretend you turn 75 in 2022) 24.6. You must withdraw $12195.12 from either source. You can do anything you want with that money, buy a bunch of hookers and blow, a lot of lap dances, whatever. As long as you take your RMD. And you have to report it in 2023 when you file your 2022 taxes. BIDEN SUCKS. If you're goin' through hell, keep on going. Don't slow down. If you're scared don't show it. You might get out before the devil even knows you're there. NRA ENDOWMENT LIFE MEMBER | |||
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| A teetotaling beer aficionado |
Did some one say it was a difficult task? Men fight for liberty and win it with hard knocks. Their children, brought up easy, let it slip away again, poor fools. And their grandchildren are once more slaves. -D.H. Lawrence | |||
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| His Royal Hiney |
I think you would have to give me the benefit of the doubt that I understand it's all computer programs doing the calculations and not "some dude sitting in a little office in the basement at Fidelity doing this." I was responding to the statement that "Your IRA custodian has to do the calculation for you." I was advocating for doing EXACTLY what you do: double checking the number. And for myself and maybe others who want to do the same thing I'm doing, I'm still years before I need to do RMDs but I'm projecting my RMDs because I want to do Roth IRA conversions before age 72 in order to minimize my overall taxes. If you don't plan on managing RMDs, then those future RMDs may push you into a higher tax bracket and also incur additional Medicare premiums because of exceeding IRMAA thresholds. Additionally, doing Roth Conversions or even just withdrawing more than the RMD up to the limit of your current tax bracket is tax efficient because the tax brackets revert back to pre-Trump tax cuts in 2025 and you'll be paying more in taxes for any IRA withdrawals thereafter. "It did not really matter what we expected from life, but rather what life expected from us. We needed to stop asking about the meaning of life, and instead to think of ourselves as those who were being questioned by life – daily and hourly. Our answer must consist not in talk and meditation, but in right action and in right conduct. Life ultimately means taking the responsibility to find the right answer to its problems and to fulfill the tasks which it constantly sets for each individual." Viktor Frankl, Man's Search for Meaning, 1946. | |||
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| Member |
^^^^^^^^^^^ Well put. If you deal with a brokerage firm there WILL be mistakes. Some are hard to correct. Mine had to do with a letter of intent that was not followed. Others had to do with transfer of funds between accounts. The support personnel of most full service brokers is not mistake proof, nor is the broker. | |||
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I Deal In Lead |
I only check once every couple of years. My Financial Advisor will pay the penalty for me if he miscalculates, so I'm not at all concerned. | |||
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| A teetotaling beer aficionado |
Of course, I wasn't challenging any ones ability to do this on their own. But computer generated programs as simple as this are seldom incorrect. Especially from a trusted institution like Fidelity. Sure it can happen, but I'd think you vs the computer... well. In the 65 years or so since I've had bank accounts, never have I found and error that the bank made. I used to meticulously check every debit and credit to my checking account. Nope, bank wins. So yes, check the number, and if your' calculations are different challenge it. Men fight for liberty and win it with hard knocks. Their children, brought up easy, let it slip away again, poor fools. And their grandchildren are once more slaves. -D.H. Lawrence | |||
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| Member |
That would be the most extraordinary thing I've ever heard from an IRA trustee or custodian so maybe that's not the relationship here. But it certainly isn't the norm in any financial relationship of an IRA holder I've known. But in any case all one should do in this is spend like 1 minute confirming the number. Mistakes can be made. My dad died and his accounts moved to my moms IRA at a different institution and they got it wrong. That was just last year. “So in war, the way is to avoid what is strong, and strike at what is weak.” | |||
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| Member |
^^^^^^^^^^^^^^^ Agreed. I did get five bucks once from my borker due to a calculation error by their computer. | |||
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| I Deal In Lead |
You don't have the right financial advisor then. Mine owns his own company and backs his workers with his wallet. I wouldn't do business with a corporate employee acting as a financial advisor. | |||
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| Member |
^^^^^^^^^^^^^^^^ Each to his own. Everyone makes mistakes. I do not have a financial advisor as I make my own investment decisions. I use a brokerage to manage the arcane rules that the IRS imposes upon Keough plans. They have been flawless in that department. Frankly I have NEVER heard of a financial advisor backing things with his own money. | |||
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| His Royal Hiney |
Then I turn the question back on you as to why do you go to the trouble of double checking it then? Not that I want you to stop doing it but to remind you why you or anyone does it. Because the one time the computer program glitches, it's going to be a pain in the ass sorting things out with the 50% penalty. And, as the IRS says, it's ultimately your responsibility. "It did not really matter what we expected from life, but rather what life expected from us. We needed to stop asking about the meaning of life, and instead to think of ourselves as those who were being questioned by life – daily and hourly. Our answer must consist not in talk and meditation, but in right action and in right conduct. Life ultimately means taking the responsibility to find the right answer to its problems and to fulfill the tasks which it constantly sets for each individual." Viktor Frankl, Man's Search for Meaning, 1946. | |||
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