IRA RMD Illustration REPORT Prepared for: William Public 4/29/2013 Prepared by: John Q. Advisor Test Advisor
CONTENTS Overview...3 Personal Data Assumptions...4 Results...5 Important Disclosure Information....6 IRA RMD ILLUSTRATION 2
OVERVIEW IRA owners are eventually required to begin taking distributions from their taxdeferred IRA accounts. This IRA RMD report is provided to help you calculate your required distribution amount from your IRA. Review this report and the rules of required minimum distributions with your legal/tax advisor. Required Minimum Distributions (RMDs) Upon reaching age 70 ½, the IRS requires IRA owners to begin withdrawing a certain amount from their IRA accounts each year. These mandatory withdrawals are called required minimum distributions (RMDs). Required Beginning Date (RBD) An IRA owner must begin taking RMDs from an IRA account in the year in which he/she turns age 70 ½. The first year s required distribution can be delayed until April 1 of the year following the year the IRA owner attains age 70 ½. This April 1 date is termed the Required Beginning Date (RBD). Every subsequent year RMD is to be distributed by December 31 of that year. When RMDs are withdrawn, the taxable amount of the RMD is added to the IRA owner s ordinary income and taxed accordingly. The IRA owner has the responsibility to withdrawal the proper amount of the required minimum distribution by the applicable deadline to avoid the IRS 50% penalty tax. Review this report and the rules and regulations pertaining to Required Minimum Distributions (RMDs) with your legal/tax advisor before authorizing distributions on your IRA account. How are RMDs calculated? Generally, RMDs are calculated for each IRA account by dividing the prior yearend December 31 balance by a life expectancy factor from IRS Tables found in Publication 590. Most will use the Uniform Lifetime Table to determine life expectancy. One exception is for IRA owners that have named their spouse as sole beneficiary on the IRA. If the spouse is more than ten years younger than the IRA owner, a joint life expectancy figure can be used. Key Rules and Considerations: RMD requirements apply to all IRAs, Traditional IRA, Rollover IRA, SEP IRA, SIMPLE-IRA, except Roth IRAs. Roth IRA owners are not subject to the RMD requirements throughout their lifetime. IRA owners with multiple IRA accounts must calculate the RMD separately for each IRA, but can distribute the total amount from any one or more of the IRAs. RMDs are not eligible for rollover, they must be withdrawn. IRA RMD ILLUSTRATION 3
PERSONAL DATA ASSUMPTIONS The following information has been used to prepare your IRA RMD illustration: IRA Information IRA account number Your date of birth Account balance as of 12/31 of preceding year Beneficiary Information Your beneficiary named on the IRA(s) Your beneficiary s date of birth This beneficiary is your spouse and sole beneficiary ABC12345 2/10/1939 125,000 Jane Public 10/15/1941 IRA RMD ILLUSTRATION 4
RESULTS The life expectancy factor for this year s distribution using the Uniform Lifetime Table is 23.8 Your IRA RMD for this year is $5,252 This RMD must be withdrawn from your IRA by December 31, 2013 Contact your Financial Advisor for the appropriate forms to request this distribution. This amount will not be automatically distributed to you. You can enroll in our automated RMD service to automatically receive a distribution of your RMD each year. IRA RMD ILLUSTRATION 5
IMPORTANT DISCLOSURE INFORMATION Wealth Management Systems, Inc. is the sole copyright owner of the software, including the accompanying materials and all documents generated by the Software. You may copy the documents generated by the Software and share such documents with your clients, provided that each copy includes the copyright, trademark or service mark notices or attributions as they appear on the pages copied. Except as stated above, reproduction or duplication by any means of the Software or any accompanying materials or the documents, without the written permission of Wealth Management Systems Inc., is strictly prohibited and in violation of federal copyright laws. IRA RMD ILLUSTRATION 6