RMD **Reminder** and Effective Ways to Use Them

Diane DeCesare of Drucker & Scaccetti is a member of XPX Philadelphia

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As we approach the 2021 tax filing season, remember it is also Required Minimum Distribution (RMD) season. You generally have until December 31, 2021, to take your RMD out of tax-deferred retirement accounts to avoid costly penalties, unless this is your first RMD year, in which case you get a grace period until April 1, 2022. You do not have to take RMD’s from your employer’s plan until you terminate or retire. Individuals who inherited qualified plan accounts, including either traditional or ROTH accounts, must take their first RMD by December 31 of the year following the death of the original account owner. While many take RMDs as cash distributions with little thought to taxes, there are other effective ways to use your RMD, which we will discuss in today’s post along with a key reminder about 2021 RMDs.

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Updated: November 23rd, 2021

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