RMD in Year of Conversion

Our team of top-notch attorneys is often asked the question, “Do I still need to take the required minimum distributions (RMD) in the year I convert if I'm over 72?”

The answer is yes, with both workplace plans and traditional IRAs.

In general, the first money withdrawn from your account each year has to satisfy your RMD and is not eligible for a rollover or conversion. Additional withdrawal amounts can be converted to a Roth IRA, which does not require RMDs. Nevertheless, you can use the after-tax money of your RMD funds to pay for some of the Roth conversion.

The CARES Act temporarily waves required minimum distributions for all types of retirement plans (including IRAs, 401ks, 403(b)s, 457(b)s, and inherited IRA plans) for the calendar year 2020. This includes the first RMD which individuals may have delayed from 2019 until April 1st of 2020.

If you have any questions or need further information, please contact our Louisiana Board Certified Tax Specialist and Louisiana Certified Public Accountant today to discuss your situation. Call (800) 835-5864 to schedule a complimentary consultation.