Archive - December 16, 2008

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House and Senate Pass Legislation Waiving 2009 RMDs

House and Senate Pass Legislation Waiving 2009 RMDs

House and Senate pass new laws on RMDs

Photo by: James Morrison

Both the U.S. House of Representatives and the U.S. Senate passed a bill that would waive required minimum distributions (RMD) in 2009. Normally, individuals over the age of 70.5 are required to withdraw an amount calculated by dividing the prior December 31st balance of the retirement account by the individual’s life expectancy as determined by the Internal Revenue Service. The government requires these distributions to ensure that money in retirement accounts is ultimately taxed. Failure to withdraw the required amount subjects the individual to a 50% penalty on the amount that should have been withdrawn in …

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