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Required Minimum Distributions


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Required Minimum Distributions

For participants born after 12/31/1950, a required minimum distribution (RMD) is not needed.

For participants born on or before 12/31/1950, please refer to this chart:

How is the amount of the RMD calculated?

RMDs are calculated for each account by dividing the prior December 31st balance of that retirement plan account by a life expectancy factor provided by the IRS. For Defined Benefit plans, please contact your Intac FuturePlan pension consultant, as these plans are subject to a different calculation methodology.

Can a plan participant withdraw more than the RMD?


If more than one plan exists, can a participant take a RMD from one plan Instead of separately from each plan or IRA?

The RMD must be calculated separately for most types of qualified retirement plans and must be taken separately from each plan account. An IRA owner must calculate the RMD separately for each IRA that he or she owns, but can withdraw the total amount from one or more of the IRAS. A 403(b) account holder also must calculate the RMD separately for each 403(b) plan, but can take the total amount from one or more of them. Participants should reach out directly to the custodian of the funds for more information.

How are RMDs taxed?

The RMD is taxed at the income rate at the time of distribution and reported on a Form 1099-R.

Can RMD amounts be rolled over into another tax-deferred account?

No. The RMD amount must be distributed before any rollover distributions are permitted, including the year the plan participant turns 72. For additional information, please refer to Publication 590-B.

What happens if the plan participant does not take the RMD by the required deadline?

If the full amount of the RMD is not taken by the applicable deadline, the amount not withdrawn is subject to a 50% excise tax. In addition, the IRS may consider this an operational plan failure. Therefore, it is critical that the RMD be taken in a timely manner.

Note: A RMD may be required from a deceased participant’s account regardless of age. Please contact your Intac FuturepPlan pension consultant for more information.