Ask Terry Questions Minimum Required Distributions into a Roth IRA?

Minimum Required Distributions into a Roth IRA?

By Terry Savage on August 15, 2019 | Financial Planning / Retirement

Hi Terry,
I turn 70 in September, 2019. I understand that I need to start taking my MRD’s in April , 2021 (calendar year after I turn 70 1/2) . But then I was told that if I waited that long, I would have to take two MRD distributions in 2021. So now I’m planning to start my first MRD in/during 2020. Is that the right approach? Also, can I deposit MRD monies into a Roth IRA? Thank you!

Terry Says

Yes, it’s a good idea not to have to take two RMDs in the same year.  Remember, that amount(s) are added to ordinary income –and could push you into a higher tax bracket if you have to take two in one calendar year.

You can do anything you want with the money — even invest it in a Roth IRA.  BUT you can only invest it in a Roth IRA if you have “earned income” for that year — and that does not include taxes, dividends, annuity payouts, SS, etc.  You must have actual income from work to make a Roth contribution at any age.

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