McKay Hochman Company, Inc.

Q. Must an individual wait until the date he or she reaches age 70½ to take his or her first required minimum distribution? Or can the RMD be taken as soon as the year starts?
Rev. 03/14/08, E-mail Alert 2008-3, Revised 10/10/08 E-mail Alert 2008-13

A. The RMD may be taken at any time during the year in which the individual attains age 70½. The IRS calls this the first distribution calendar year and the RMD for the first distribution calendar year may be taken at any time from January 1 of the year the individual becomes age 70½ until the Required Beginning Date (generally by April 1 of the year after the year age 70½ is reached, or if still working and not a 5% owner, by April 1 of the year after the year of retirement).

Q. An individual has been receiving the required minimum distribution (RMD) amount each year. This year, he requests $25,000 in addition to the RMD. Is the $25,000 an eligible rollover distribution subject to 20% mandatory withholding?
Rev. 07/21/05, E-mail Alert 2005-14, Revised 10/10/08. E-mail Alert 2008-13

A. RMD amounts are not eligible rollover distributions. Therefore, the 20% mandatory withholding requirement is not applicable. However, random distributions in excess of the RMD, such as the $25,000 in this case, are eligible for rollover to an IRA or an eligible retirement plan and, therefore, are subject to the 20% mandatory withholding.

Q. What is the new life expectancy table for calculating Required Minimum Distributions? Rev. 05/17/02

A. The IRS issued Final Required Minimum Distribution Regulations on April 17, 2002. These regs contain a new table called the "Uniform Lifetime Table". This table will be used for calculating all minimum required distributions for the lifetime of the participant starting with the 2003 tax year. The only exception is where there is a spouse who is more than 10 years younger in which case the new joint life table may be used. After the death of the participant, generally, the beneficiary will use the new single life expectancy table. Below is the "Uniform Lifetime Table":

UNIFORM LIFETIME TABLE April 17, 2002
Age	Distribution Period	Age	Distribution Period
70	27.4	93	9.6
71	26.5	94	9.1
72	25.6	95	8.6
73	24.7	96	8.1
74	23.8	97	7.6
75	22.9	98	7.1
76	22	99	6.7
77	21.2	100	6.3
78	20.3	101	5.9
79	19.5	102	5.5
80	18.7	103	5.2
81	17.9	104	4.9
82	17.1	105	4.5
83	16.3	106	4.2
84	15.5	107	3.9
85	14.8	108	3.7
86	14.1	109	3.4
87	13.4	110	3.1
88	12.7	111	2.9
89	12	112	2.6
90	11.4	113	2.4
91	10.8	114	2.1
92	10.2	115+	1.9

Q. May an individual with several Individual Retirement Accounts (IRAs) calculate the required minimum for each IRA and withdraw the aggregate of those RMDs from one or more IRAs or must the minimum be withdrawn from each IRA that the individual owns?
Rev. 03/21/02, Revised 10/10/08, E-mail Alert 2008-13

A. According to IRS Notice 88-38, the owner of two or more IRAs may use the "alternative method" to satisfy the minimum distribution requirements by taking from one IRA the amount required to satisfy the minimum requirement for another IRA(s). To do so, the IRA owner must calculate the minimum for each IRA separately, total the minimum required amount for each IRA, and then withdraw that total amount from any one or more of his/her IRAs. Please note that Notice 88-38 only applies to IRAs; therefore, each qualified plan must distribute a participant’s required minimum.

Further, the IRS also permits 403(b) RMDs to be aggregated and withdrawn from any one or more 403(b)s. However, the IRS does not permit the aggregate of IRAs to be aggegated with the aggregate of 403(b)s [and taken from just an IRA or 403(b)].