From Mark Pallack, New York Life
Suspension of the 2009 Required Minimum Distribution (RMD) requirement
President George W. Bush recently signed H.R 7327, the “Worker, Retiree and Employer Recovery Act of 2008.” One of the provisions of the bill suspends the Required Minimum Distribution (RMD) requirements applicable to qualified retirement accounts, such as IRAs and TSAs, for 2009.
Due to this legislation, IRA and TSA owners who are age 70 ½ or older and inherited IRA owners are not required to take an RMD for 2009. This also includes any clients who first become RMD eligible in 2009. However, please be aware that this provision does not apply to any 2008 RMD that is permitted to be made in 2009 because the individual’s required beginning date is April 1, 2009. These individuals will still need to take their 2008 RMD by April 1, 2009.
If you or your clients have a previously established RMD Periodic Partial Withdrawal disbursement arrangement, the companies will continue to honor these payment requests. Any individuals or clients who wish to suspend their RMD PPW arrangement for 2009 will need to contact their respective financial advisor.