Rmd Ira Rules
August 1st, 2005
Question: why can’t the interest on my husband’s IRA CD be used toward his RMD any longer–have the rules changed–he is?
72 years old and up until now has been using the interest to cover the RMD–now he was told he can’t do that anymore–isit the institution or the government? thanx
Answer: The mandatory distribution changes every year. The calculation is based on balance in the account and remaining years of life.
If it was determined that your husband would not exhaust the value of the IRA by the time he dies, they raise the distribution amount. Now, you have to dip into the principal in addition to any interest earned.
The govt regulates the distribution, the banks just follow the rules. It’s too bad the govt gets involved in how we manage our money, but that’s the way it is.
Consumer Alert about your life insurance policy! Featuring retirement expert Bill Smith!
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