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Subject:  Re: Another IRA RMD Question Date:  7/22/2011  1:22 PM
Author:  BruceCM Number:  113807 of 130723

If your 70th birthday is before July 1 of this year, then this will be your first RMD year, and your required beginning date (RBD) will be April 1, 2012...the date by which your first RMD must be removed from your Traditional IRA. All subsequent RMD's in future years must be out of the IRA by 12/31 of that year.

There are 2 and only 2 things that you can do with this year's RMD. You may withdraw it and report it as ordinary income on your 2011 tax return (assuming your IRA(s) have no basis) by the RBD or you may have it transferred directly to the charity of your choice without having to declare it as ordinary income to you (2011 only), again, by your RBD. You may not convert this RMD to a Roth IRA and you may not transfer it out of the IRA.

The balance remaining in your TIRA(s) after taking out the RMD may be converted to a Roth IRA as you see fit. Again, assuming there is no basis in your TIRA(s), all Roth conversions will be reportable that year on your tax return as ordinary income.

Now, you could take your RMD dollars...or any other $$ you wish to use...and contribute to your Roth IRA, as long as you have earned income (W2 income or Schedule C self employment income) that at least equals your Roth contribution. This is simply a household cashflow exercise.

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