Minimum Required Distribution
Minimum required distribution (MRD) are mandatory withdrawals by the IRS from retirement accounts each year once you reach age 70 1/2.

MRD applies to these account types:
You must take an MRD for traditional IRAs, SEP IRAs, SIMPLE IRAs, 401(k) plans, 403(b) plans, 457(b) plans, profit sharing plans, other defined contribution plans. You do not need to take MRDs for Roth IRAs unless they are inherited accounts. Roth 401(k) accounts are also subject to MRD rules.



The MRD 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.” A separate table is used if the sole beneficiary is the owner’s spouse who is ten or more years younger than the owner.

For MRD after the account owner dies, use the MRD the account owner would have received for the year of death. For the year following the owner’s death, the MRD will depend on the identity of the designated beneficiary, for example spouse or non-spouse.

Consequences for failing to take MRD:
You can withdraw more than the MRD. If you do not take any distributions, or if the distributions are not large enough, you may have to pay a 50% excise tax on the amount not distributed as required.

Please call us at (949) 253-8888 to help you calculate and process your MRDs before December 31st.

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