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May 2009
20
May 20, 2009

No Required Minimum Distributions From Retirement Plans and IRAs for 2009

Last year, Congress passed a law that waives for 2009 the requirement that persons over 70 1/2 must take a minimum distribution from a retirement plan or IRA. This means that you need not take a minimum required distribution from your retirement plan or IRA for 2009. You also do not need to take a minimum required distribution from an inherited retirement plan or IRA.

If you are currently taking distributions over five years (for instance, if you inherited a plan and it requires a five-year payout), the distribution period is extended one year, effectively becoming a six-year payout period.

The 2008 required minimum distribution is unaffected by this rule. Thus, if your required beginning date to start taking minimum distributions is April 1, 2009 (for instance, if you reached age 70 1/2 in 2008, you could defer taking your first distribution until April 1, 2009), you must still take that required distribution by April 1, 2009.

Of course, you can always elect to take more than is required from your plan or IRA, and you can elect to take a distribution in 2009 even though you are not required to do so.

FDIC Changes

As reported in last fall’s issue of Estate Planning Focus, the Federal Deposit Insurance Corporation (FDIC) insurance amount on interest-bearing deposit accounts was increased from $100,000 to $250,000. However, this increase is temporary and ends December 31, 2009, at which time it reverts to $100,000 per interest-bearing deposit account. To ensure your deposits remain within the FDIC limits, you should review your accounts in December 2009.

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