What are Required Minimum Distributions?
Hi this is Joshua Cicora with Retirement Help talking to you today about RMDs (Required Minimum Distributions). One of the many things about retirement that everybody needs to know but everybody’s afraid to ask.
While you were working, you’ve been saving for retirement in accounts such as 401(k)s, traditional IRAs, etc. As you’ve been doing that you’ve received a tax deduction. But now that you’re turning 73 or 75 depending on the year you were born, Uncle Sam says now you have to start taking money out of those accounts, a bit every year, to start cashflowing your retirement. And he’s looking forward to you paying taxes on those distributions.
In most situations you will have to pay taxes on Required Minimum Distributions. There are some limited exceptions where you can do charitable giving out of those distributions and have those then get deducted on your tax returns. In general, though, be expecting to pay taxes on those as you take them out. That’s why it’s important to work with a financial advisor who can help you have taxes withheld as you takes those distributions out.
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About the Author
Joshua Cicora is a contributing author with Retirement Help that has worked to help take the headache out of taxes since 2007. “People work hard for their money. They need an experienced tax professional to make sure they keep as much of it as possible.” He strives to help clients navigate a challenging tax landscape.Ongoing changes from the IRS and Department of Revenue require a professional to always be on top of the latest developments, and Joshua makes it a priority to stay current with the latest legislative changes. Joshua earned an accounting degree from Wichita State in 2008 and has been a Certified Public Accountant in Kansas since 2011. He currently works for Market Tax Services in Wichita, KS where he lives with his wife and two daughters.
This information is being provided only as a general source of information and is not intended to be the primary basis for financial or estate planning decisions. It should not be construed as advice designed to meet the particular needs of an individual situation. Please seek the guidance of a financial professional regarding your particular financial concerns. Consult with your tax advisor or attorney regarding specific tax issues.
