Required Distributions

There is an exception in the tax code for 2009 only that is not widely advertised. Congress has granted a wave for required minimum distributions from IRAs for this year only.

I think the word is not being circulated because it sounds like a break for evil rich people who have $ in IRAs.

My dad paid his accountant to figure his minimum required withdrawal each fall. That's right. He paid him for the appointment even if only over the phone. If Dad didn't need the $, the CPA would "sell" Dad a mutual fund. I say sell because the man made over 5% commission on each sale.

Dad died two years ago and I rolled my portion of his IRA into an inherited IRA. I am required to take out distributions each year based on my life expectancy. Except for this year.

My dad would have enjoyed getting to leave his $ in and not having to pay taxes on it. Yes, it's the taxable event and the huge penalties if the minimum is not withdrawn that is the governments gift to those rich old people.

An aside: Dad's CPA filed for bankruptcy last month. Not enough old people needing those fall appointments to take out IRA $ and pay him to invest it in a load mutual fund?

'til later