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Nosbocaj asks:

In the final paragraph of the January 29 article "More on New IRA Distribution Rules" you say "You must make changes before you take an IRA distribution this year". It is not clear to me exactly how you inform the IRS (or whoever needs to know) that you wish to make a change. I have been taking my distributions in small "as needed" amounts throughout the year until I reach my MRD amount. If my factor becomes less, wouldn't the only change be that I would withdraw less total dollars between now and Decemeber 31, 2001?

Yes, that's true. The remarks really apply to those who must take a forced payout of an inherited IRA this year. But nevertheless for all, it means take a look at which rules, the old or the new, will benefit you more before you take an MRD this year. If you take it under the old rules without looking at it, then you're stuck with those rules for this year's MRD. The new ones may be better. So compute your MRD under both sets of rules and choose the one that's best for you. Then take at least that much this year. OTOH, if you're over 70 1/2 and you're going to take more than the MRD under either method, then it doesn't make one whit of difference. That's because come next year you will be required to use the new table anyway.

There's nothing special you have to do this year to use one method or the other excpet to compute the MRD. Just keep a record on how you computed the MRD for potential audit purposes. Otherwise, there's nothing to file with your income tax return next year except the 1099 showing that distribution.

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