Required Minimum Distributions For Those Over 70½

money-87201_1920For clients fortunate enough not to need to use income from qualified retirement plans in their 70s, required minimum distributions can sometimes amount to a taxable nuisance. There are ways, however, to get more mileage out of those required distributions, particularly with advance planning.

The first step, then, is to make sure the client knows they are at the age where they need to start taking RMDs – and then to see if any of the following tactics will work for them.

What to do with them:
1.Purchase life insurance
2.Purchase long-term-care insurance
3.Fund a 529 plan
4.Make a charitable gift using a donor-advised fund
5.Pay the tax due on a Roth conversion
6.Just reinvest the funds

If you have questions about your retirement plan or any other financial matters, contact ClearPath Accountants.

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