BIRDSEYE FINANCIAL SERVICES (360) 722-7889
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REQUIRED MINIMUM DISTRIBUTIONS
Remember to start these at age 72

What Is a Required Minimum Distribution (RMD)?
A required minimum distribution (RMD) is the amount of money that must be withdrawn from an employer-sponsored retirement plan, traditional IRA, SEP, or SIMPLE individual retirement account (IRA) by owners and qualified retirement plan participants of retirement age.

In 2020, the age for withdrawing from retirement accounts changed. You must begin withdrawing from a retirement account by April 1 following the year account holders reach age 72 (prior to 2020, the RMD age had been 70½ years old). The retiree must then withdraw the RMD amount each subsequent year based on the current RMD calculation.
KEY TAKEAWAYS
  • The required minimum distribution is the amount you must take out of your account to avoid tax consequences.
  • Retirees can and do take more than the RMD.
  • If you have multiple accounts, you will usually need to calculate the RMD for each separately and may have to take an RMD from each.
  • The SECURE Act of 2019 changed the distribution rules for some inherited IRAs, effectively eliminating the "stretch IRA"—an estate planning strategy that extended the tax-deferral benefits of IRAs.
  • The RMD rules do not apply to Roth IRAs while the owner is still alive. However, the RMD rules do apply to Roth 401(k) accounts.
Understanding Required Minimum Distribution (RMD)
A required minimum distribution (RMD) acts as a safeguard against people using a retirement account to avoid paying taxes. Required minimum distributions are determined by dividing the retirement account’s prior year-end fair market value (FMV) by the applicable distribution period or life expectancy. The Internal Revenue Service (IRS) has a worksheet to help taxpayers calculate the amount they must withdraw. Generally, your account custodian or plan administrator will calculate these amounts and report them to the IRS.

Some qualified plans allow certain participants to defer the start of their RMDs until they actually retire, even if they are older than age 72. Qualified plan participants should check with their employers to determine whether they are eligible for this deferral.

It should be noted that while an account holder must withdraw the required minimum distribution amount, they can also withdraw above that amount. If the account holder wants to withdraw 100% of the account in the first year, that’s perfectly legal, but the tax bill could be a shocker.
The RMD rules do not apply to Roth IRAs while the owner is still alive. However, the RMD rules do apply to Roth 401(k) accounts.
It should be noted that while an account holder must withdraw the required minimum distribution amount, they can also withdraw above that amount. If the account holder wants to withdraw 100% of the account in the first year, that’s perfectly legal, but the tax bill could be a shocker.
Please know that we do not offer any form of tax or legal advice. You should seek out a qualified advisor for these types of questions. This information above is for educational purposes only.
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Birdseye Financial Inc
136 Hillside Dr E
Burleson, TX 76028
Phone # 360-722-7889
Fax #425-412-6865
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INFO@BIRDSEYEFINANCIAL.COM
The contents of this website are for educational purposes only. Any material and its attachments, links, downloads, and/or any emails from our company are not intended to provide legal or tax advice. To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. federal or state tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any transaction or matter addressed herein. Please seek the advice of appropriately licensed individuals for legal or tax advice relating to your individual situation. Birdseye Financial and its employees are not tax or legal advisors and are not operating in such a manner. Birdseye financial and those working for the company are not licensed Investment Advisors which prohibits us from offering such advice. Any advice you get should be taken as non-investment advice and only educational in nature. Should our clients need a licensed investment advisor, we partner with LifePro Asset Management. *Investing carries an inherent element of risk. No strategy can guarantee a profit or prevent a loss. Provided content is for overview and informational purposes only and is not intended and should not be relied upon as individualized tax, legal, fiduciary or investment advice. Any illustrations used are hypothetical and were used for explanatory purposes only. THANK YOU!

MEDICARE MANDATORY DISCLAIMER
“We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE to get information on all your options.” (MORE DETAIL)

State Licenses

​LICENSES: AZ #7101306, CA #4140429, FL #W825259, ID #863617, MA #2176921, OK #3001663224, OR #7101306, TX #2695866, WA #190780

This calculator is designed to be information and educational tool only, and when used alone, do not constitute investment advice. We strongly recommend that you seek the advice of a financial services professional before making any type of investment. We also encourage you to review your insurance and investment strategy periodically as your financial circumstances change.

This report is for illustration purposes only. PAST PERFORMANCE IS BASED ON HYPOTETHICAL HISTORICAL DATA AND IS NO GUARANTEE OF FUTURE RESULTS OR INTENDED TO PREDICT ACTUAL PERFORMANCE. ACTUAL INTEREST CREDITING RESTULTS WILL VARY BASED ON MARKET CONDITIONS< INDEX ALLOCATIONS< AND INTEREST CAP RATE / SPREADS / PARTICIPATION RATES. The use of different time periods and amounts will vary results.

S&P 500 and S&P are registered trademarks of Standard and Poor's Financial Services LLC. No annuity or financial product discussed herein is not sponsored, endorsed, sold, or promoted by Standard and Poor's Financial Services LLC, S&P Dow Jones Indices LLC, or their affiliates, and non of the Stand and Poor's Financial Services LLC, S&P Down Jones Indices LLC, or their affiliates makes any representation regarding the advisability of purchasing an insurance or financial product.

  • Home
  • About
    • Welcome to Birdseye
    • Who We Are
    • Risk & Portfolio Assessment
    • Request Free Consultation
  • Strategies
    • Key Components
    • Sequence of Returns
    • Rule of 100
    • Tax Strategies >
      • RMD Calculator
      • IRA RMD RULES
      • ROTH IRA
      • Qualified Charitable Donation
      • Business Tax Credit
    • Inflation Impact
    • Educational Webinars >
      • Taxes in Retirement
      • 3 Economic Strategies
      • Five Key Areas of Retirement
    • Online Education
    • Institute of Financial Wellness
  • Planning
    • Retirement Analysis
    • Social Security >
      • Social Security Webinar
    • Pension Maximization
    • Risk Analysis and Investments
    • LifePro Asset Management
    • Federal Benefits >
      • Federal Benefit Kit
    • Business Tax Credit >
      • Research & Development Tax Credit
      • Employee Retention Tax Credit
      • Resources
  • Insurance
    • Annuities
    • Medicare >
      • Medicare Questionnaire
      • Medicare Networks
      • Medicare Clients
      • Medicare Rules
    • Long-Term Care
    • Life Insurance
    • Final Expense
    • Health Insurance
    • Dental Insurance
    • Vision Insurance
  • Tools
    • Financial News Blog
    • Documentaries
    • Market Index Links
    • Required Minimum Dist (RMD Calculator)
    • Calculators
    • Professional Referrals
    • Bankrate Interest Rates
    • Zillow Home Value
  • Contact
    • Free Consultation
    • Schedule Appointment
    • Online Meeting
    • Secure Upload
    • Retirement Analysis
    • Application
    • Retirement Portal
    • Rate our Service
    • Refer a Friend