With respect to any tax year, beginning with the year during which you reach age 70 ½, you are required to begin to receive yearly distributions from your IRA not less than an amount calculated to pay out your IRA over your life expectancy or the joint life and last survivor expectancy of you and your beneficiary who is ten years younger. The appropriate factors for determining the minimum payment required are published by the Internal Revenue Service in Publication 590. Once your life expectancy and, if applicable, that of your beneficiary has been determined for your first distribution year, subsequent minimum distributions may be determined by either reducing the previous life expectancy by one-year or by recalculating the life expectancy. If you receive less than the minimum amount required by law, a 50% excise tax, payable by you, may be levied against the amount by which your actual distribution, during a tax year, is deficient. This excise tax is not tax deductible.
When you are in RMD status and have an account with GuidedChoiceIRA, you will be notified each year of the need to take an RMD and the amount required. You will still have to elect to take the RMD online or by contacting our client service representatives because if you have other retirement accounts, the RMD amount required may come out of a non-GuidedChoiceIRA account.
You are never required by law to take distributions from a Roth IRA, until the year following the IRA owner’s death.