By Andy Ives, CFP®, AIF®
IRA Analyst
QUESTION:
A 401(k) plan participant over age 73 wants to roll over his account to a new IRA. I understand that he must take a required minimum distribution (RMD) before the rollover. Is an additional RMD required in the same year from the IRA?
ANSWER:
If this person has no other IRAs besides the new one receiving the 401(k) funds, then no additional RMD needs to be taken from the IRA for this year. Reason being is that the IRA receiving the 401(k) rollover funds had a $0 balance on December 31, 2024. With no balance for the previous year’s end, there is no 2025 RMD on the IRA to calculate.
QUESTION:
I am turning age 73 this year and will need to take my RMD. I have three different investment firms for my IRAs, SEP IRA plan and a 457(b) plan. My question is: Do I have to take my required minimum distribution (RMD) from each plan/firm or can I take the full amount from any one of the accounts?
Thank you,
Dean
ANSWER:
Dean,
Your question is all about the RMD aggregation rules. Some accounts can be aggregated for RMD purposes, and some cannot. In your specific scenario, the IRAs and SEP IRA account RMDs can be aggregated. While the RMD must be calculated individually for each IRA and the SEP account, all or any portion of the aggregated total can be taken from any combination of the IRAs and SEP. The 457(b) RMD, on the other hand, cannot be aggregated with any other account. That RMD must be taken from the 457(b) plan.
If you have technical questions you would like to have answered, be sure to submit them to mailbag@irahelp.com, to be answered on an upcoming Slott Report Mailbag, published every Thursday.
https://irahelp.com/slottreport/rollovers-and-required-minimum-distributions-todays-slott-report-mailbag/