RMDS -- December 27, 2021

This is not tax advice. This is for my benefit only. RMDs can be very, very confusing. On the way to looking up something else, I happened to come across a couple of interesting links. 

All good news if I'm interpreting things correctly. I often mis-read things. If this is important to you, go to the source.

RMDS
New "IRS longevity tables" in 2022? Link here.

Example, a single 75-year-old woman whose IRA is worth $100,000 at the end of 2021 will have to withdraw a minimum of $4,065 in 2022, about $300 less than she would have under the earlier guidelines

Link here for more comprehensive review. Three years compared:

• tax year, 2020;
• tax year, 2021;
• tax year, 2022;

For tax year 2021, regarding non-spouse / non-eligible designated beneficiaries who inherit an IRA after 2019 are subject to a new 10-year payout rule and do not use this or any table. 

But look at this, for tax year 2022 (tax will be due April 15, 2023):

• new longevity tables (to the taxpayers' advantage; and,
• then this: 

The IRS included a transition rule for non-spouse beneficiaries who inherited an IRA prior to January 1, 2022 after RMDs have begun, and who are currently using the Single Life Table. The transition provides a “reset” for the life expectancies using the new tables. Therefore, table changes for 2022 will be more complicated.

There will be a one-time reset (“redetermination”) of the life expectancy that year. The beneficiary will “go back” to the year after the year of owner’s death and find his/her (i.e., beneficiary’s not the deceased) single life expectancy as of his/her age in that year using the new table. Subsequently, one year will be deducted from the new life expectancy for each year since the first distribution year to arrive at the divisor for the relevant post-2021 year.