Still working at 72 — 40l(k) RMD??
I have investment in I R A .I am 71 and I am still working.I have 401 k from my job.next year I have RMD from Ira
If I choose my Ira change to my 401 k .still I have to RMD I need your opinion. I am planning to work as long I am healthy
Thank you
Terry Says
Good. Keep working. Let’s discuss the IRA and the 40l(k) separately.
Yes, starting the year you reach age 72, you must take an RMD from your IRA. Your plan custodian will calculate the amount for you.
BUT you may qualify for an exemption from RMDs if you are still working at the company with your 40l(k) at age 72.
Here are the rules from the Fidelity website:
However, you may qualify for an exception from taking RMDs from your current employer-sponsored retirement account, such as a 401(k), 403(b), or small-business account, if:
You’re still working
You do NOT own more than 5% of the business you work for
You have an employer-sponsored retirement account with the business you work for
If you meet all the criteria above, you may delay taking an RMD from the account until April 1 of the year after you retire. Keep in mind that this does not apply to IRAs or other accounts you may hold with companies you no longer work for.
So do not let the IRA custodian use your 40l(k) balance in making the RMD calculation for your IRA. Only the IRA money needs to be considered, if you meet the above criteria.
