Giant Leap for IRA Simplification

New proposed regulations issued by the Treasury Department offer to do away with the complicated task of calculating IRA distributions. No longer will taxpayers have to rely on complicated life expectancy tables, nor will beneficiaries have to be locked in forever.

The required distributions will henceforth be determined from a single tax table which produces the smallest required minimum distribution allowed under the old rules. With this simple change, the IRA account holder will be able to easily determine the required annual distribution, and the IRS will know what to expect as a minimum amount of taxable income from account holders who are receiving distributions.

The previous rule for calculating distributions that includes a reduction based on the age of a beneficiary's spouse who is more than 10 years younger will still apply.

Distributions after the death of an IRA account owner may now be spread over what remains of the owner's actuarial life expectancy.

Financial institutions and trustees maintaining IRA accounts will now be required to report minimum required distributions of all accounts to the IRS.

Taxpayers may begin applying the proposed regulations immediately.

You may like these other stories...

Mike "the Situation" Sorrentino, one of the stars on the former TV show "Jersey Shore," is in the middle of…well, a tax situation.On October 23, the erstwhile reality show attraction was arraigned...
Deal to lock in US tax cuts is bubbling up on the HillSome US lawmakers are exploring a post-election deal that would lock in permanent tax cuts for major corporations and low-income families, Richard Rubin of Bloomberg...
For many individuals, a key part of their investment and estate planning is to write yearend checks for gifts to family members. The following reminders will help put your tax planning in perspective for 2014 and beyond, and...

Already a member? log in here.

Upcoming CPE Webinars

Nov 5Join CPA thought leader and peer reviewer Rob Cameron and learn ways to improve the outcome of your peer reviews while maximizing the value of your engagement workflow.
Nov 18In this session Excel expert David Ringstrom, CPA tackles what to do when bad things happen to good spreadsheets.
Nov 19How do you minimize redundant work and unnecessary steps to maximize the amount of work moving through your firm?
Nov 20Kristen Rampe will share how to uncover new opportunities with your clients by asking powerful questions.