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TaxRobin, Senior Advisor
Category: Finance
Satisfied Customers: 15582
Experience:  15 years of experience in financial advising with emphasis on tax issues.
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What is the percentage of RMD that I must take from the total

Customer Question

What is the percentage of RMD that I must take from the total dollars of my investments and IRAs? Do my reinvested dividends count as RMDs?
Submitted: 1 year ago.
Category: Finance
Expert:  TaxRobin replied 1 year ago.
HelloThe required minimum distribution for any year is the account balance as of the end of the immediately preceding calendar year divided by a distribution period from the IRS’s “Uniform Lifetime Table.” IRS publishes the Tables in Publication 590-B, Distributions from Individual Retirement Arrangements (IRAs). Choose the life expectancy table to use based on your situation. You generally have to start taking withdrawals from your IRA, SIMPLE IRA, SEP IRA, or retirement plan account when you reach age 70½. You are not required to receive RMDs from other investments.The RMD rules apply to all employer sponsored retirement plans, including profit-sharing plans, 401(k) plans, 403(b) plans, and 457(b) plans. The RMD rules also apply to traditional IRAs and IRA-based plans such as SEPs, SARSEPs, and SIMPLE IRAs.The RMD rules also apply to Roth 401(k) accounts. However, the RMD rules do not apply to Roth IRAs while the owner is alive.
Customer: replied 1 year ago.
That is as clear as mud.
Expert:  TaxRobin replied 1 year ago.
There is not just one percentage amount for all.Your retirement accounts (IRA 401k) are under RMD not your investments,
Expert:  TaxRobin replied 1 year ago.
Reinvested dividends for shares you hold on investments would have no relation to RMD .
Expert:  TaxRobin replied 1 year ago.
Your IRA administrator (bank or broker) would calculate your RMD for you. They do that based on the balance in your IRA at year's end.
Expert:  TaxRobin replied 1 year ago.
If you have more than one IRA, you must figure the required distribution separately for each IRA but you can take the full RMD form just one to cover all.
Expert:  TaxRobin replied 1 year ago.
I am trying to break it down in simpler terms for you. Let me know if this helps.