Retirement Plans Covered
If you have a IRA, 401(k), SEP-IRA, TSA or SIMPLE Plan you are required to begin minimum distributions by age 70 1/2. Roth IRA's are NOT covered by the MRD rule.

Multiple Retirement Plans
If you have more than one retirement plan which minimum required distributions must be made you must calculate the amount required for each plan. The actual minimum distribution may be taken from one plan to satisfy the MRD. The value used to calculate the MRD is the total value of each plan as of December 31 of the preceding year.

IRA Penalty
Failure to make the required distribution by the end of the calendar year results in a penalty equal to 50% of the amount of the distribution. In addition ordinary income taxes are due on the entire amount as well.

Calculating the MRD
Calculating the MRD is easy. Take your account balance as of December 31 of the preceding year and divide by your life expectancy.

• Account Balance
  Contributions - Includes all contribution made in the immediate preceding year for which the calculation is being made.
  Distributions - When calculating the distribution for the second year only, it is reduced by any distribution made in that year to satisfy the minimum distribution requirement for the first year. The first year distribution year is the year in which you reach age 70 1/2.
  
  
• Life Expectancy
  Single Life Expectancy - The owners life expectancy as set forth by IRS Table I - see IRS Publication 939
  Joint Life Expectancy - The owner and designated beneficiary set forth by IRS Table II - see IRS Publication 939
  Death of Owner - If the owner dies before distributions have begun, the remaining life expectancy of the beneficiary.