2009 RMD Previously Taken Can Be Rolled Over Through November

Normally, taxpayers age 70½ and older have to take required minimum distributions (RMD) from qualified pension plans and IRAs (excluding Roth IRAs).  Because of the collapse of the stock market that began in 2008, the government decided to suspend the RMD requirement for 2009 to allow individuals’ pension accounts and IRAs to recover. 

However, many retirees received “unnecessary” distributions due to automated computer program distributions from financial institutions or took distributions not understanding the suspension of the requirement for 2009.  Even though the funds could have been rolled into an IRA within 60 days, the IRS feels there is enough confusion over the suspended RMD rules to provide special relief for those who took a distribution and wished they had not. 

As a result, the IRS has extended the normal 60-day rollover period to the end of November 2009 for any RMD taken earlier in 2009, and no reason is required. However, no more than one distribution from an IRA in 2009 will be eligible for this rollover relief.

If you took a 2009 RMD earlier this year, this provides a unique year-end planning opportunity.  It may or may not be in your best interest to roll it over based on your particular tax circumstances and bracket.   Please call this office for assistance.  

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