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required minimum distribution

RMDs Don’t Have to Be Taken in Cash

But… It’s a little-known fact that distributions from an IRA  or a Qualified Retirement Plan can be taken in kind, rather than in cash.  You can in any circumstance take distribution from the account of stocks, bonds, or any investment that you own, just the same as if it were cash. The downside to this is determining valuation for the distribution.  You could value the distribution on the day of the distribution by opening price, closing price, average price, or mean between the day’s high and low prices.  Where you really get into trouble is when the security that you own is very thinly-traded, such as a small company or very infrequently-traded bonds.  These can be very hard to value on the date of distribution, and as you might recall, the value of a distribution for Required Minimum Distributions (RMDs) must be valued appropriately in order to ensure that the […]

Which Account to Take your RMDs From

Image via Wikipedia When you’re subject to the Required Minimum Distributions (RMDs) and you have more than one IRA account to take the distributions from, you have a choice to make.  Even though you have to calculate the RMD amount from all of your IRA accounts combined, the IRS provides that you could take the total of all your RMDs from a single account if you wish. With this provision in mind, you could take all of your RMDs from the smallest account, which would provide you the opportunity to eliminate one of the accounts in your list, thereby simplifying things.  By reducing the number of accounts that you have, you could simplify the calculation of RMDs, estate planning, and just general paperwork. However, it might not always work to your best interests to reduce the number of accounts that you have.  You may have multiple accounts in order to […]