Once taxpayers reach 70 1/2 they are required to withdraw certain amounts from retirement accounts – referred to as Required Minimum Distribution or RMD. The RMD is calculated by dividing the account balance as of the preceding December 31 by the applicable life expectancy divisor.
The IRS regulations allow for the use of three tables:
Table 1 –
Used by most taxpayers – Table_III
Table 2 –
Used if the owner’s spouse is the sole beneficiary and more than 10 years younger than the owner – Table_II
Table 3 –
Single life. Used if no named beneficary or estate is named beneficairy – Table_I