Required Minimum Distributions Due April 1st
The IRS has released a reminder that the deadline for tax-qualified retirement plan participants to begin receiving the required minimum distributions (RMDs) is April 1, 2018. The deadline applies to plan participants who “have reached at least age 70 1/2 and retired in 2017”.
The IRS reminds employers that the deadline applies to all employer-sponsored retirement plans.
JD Supra highlights other important sections of the reminder:
- The April 1 RMD deadline only applies to the required distribution for the first year. For all subsequent years, including the year in which recipients were paid the first RMD by April 1, the RMD must be made by Dec. 31. A taxpayer who turned 70½ in 2017 and receives the first required distribution (for 2017) on April 1, 2018, for example, must still receive the second RMD by Dec. 31, 2018.
- Affected taxpayers who turned 70½ during 2017 must figure the RMD for the first year using the life expectancy as of their birthday in 2017 and their account balance on Dec. 31, 2016.
- Employees of certain tax-exempt organizations with 403(b) plan accruals before 1987 should check with their employer, plan administrator or provider to see how to treat these accruals.
For more on the IRS’s reminder, please click here.