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I've picked up a little info that I can skip a Required Minimum Distribution (RMD) from a company's 401 in the year I turn 70 1/2, if I am still working for such company.

I haven't found any info on what defines "working." Does it have to be 40 hours a week for the year, or can it be part time? Can it be for just a week or two in the calendar year?
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I've picked up a little info that I can skip a Required Minimum Distribution (RMD) from a company's 401 in the year I turn 70 1/2, if I am still working for such company.

Please note - not just any 401(k) RMD can be 'skipped'. The 401(k) that you are attempting to not take the RMD from has to be the plan sponsored by the company that you are working for.

I haven't found any info on what defines "working." Does it have to be 40 hours a week for the year, or can it be part time? Can it be for just a week or two in the calendar year?

All the rules for skipping 401(k) distributions if you are working for the company are specific to that company's plan. So the definition of 'working' would be dependent on what rules the company's plan requires. At a minimum, it would probably have to be enough so that you are qualified to make contributions to the 401(k). So if the company requires that one has to work, say, at least 20 hours per week in order to make contributions, then you would have to be working at least 20 hours a week.

And as far as 'working a week or two during the calendar year' - that's not going to fly unless you are still considered employed during the entire year, even though you only worked a week or two. As soon as you stop working at the company, the RMDs will need to start again.

Why are you so focused on not taking RMDs from your 401(k)?

AJ
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It depends on the plan and you will need to talk to them to find out.

As a data point of one, I'm a part time seasonal employee and had to work 1000 hours in a calendar year to qualify for the seasonal employees 401K plan. Once qualified I can continue to contribute without working 1000 hours in the year. If I don't work at least 1000 hours, I do not receive the company matching funds. I am not required to take RMDs from the money in the plan yet. At some point, probably next season, I will not return to this job and at that point will have to take RMDs, or roll the plan over into my existing traditional IRA and include it in the RMD from that plan.
YMMV.
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I have a strong desire to grill up some hotdogs for lunch, must be my bio clock knows memorial day week-end is coming up.

Thanx much AJ, I'll check with the TSP plan.

My preference is to never have to touch my tax-defferred accounts..or as little as possible, and pass that on to others. Also I've been converting as much as I can to Roths without getting kicked up to the next tax bracket.

Hope you all have a great week-end. (And maybe in-between dogs and burgers, pass on info to the milleniels and gen-x'ers (or whatever else they are called) in your family tree about what their grandparents/ great-grandparents did in the military. (Ours were in the phillipines, battle of the bulge, and stateside (that was grammy)).
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Oops,

Rosewine, thanx much for your reply also, sorry I missed you in above post.

if by chance you'll be in reno for hot august nights, ... or in north carolina in the winter or spring, let me know, I'll buy you a beer (or a coke)
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My preference is to never have to touch my tax-defferred accounts..or as little as possible, and pass that on to others. Also I've been converting as much as I can to Roths without getting kicked up to the next tax bracket.

I am also doing conversions to Roth accounts, but I'm not planning on emptying all of my tax deferred accounts, so I will have some RMDs. While my preference would be to leave as much as possible in tax deferred accounts, personally, it wouldn't be worth it to go back to work enough just so that I could defer RMDs on a 401(k). That seems to be defeating the purpose of retiring.

AJ
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""it wouldn't be worth it to go back to work enough just so that I could defer RMDs on a 401(k). That seems to be defeating the purpose of retiring."


Every day is a holiday, and every lunch is a picnic...when you work in the woods.
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""it wouldn't be worth it to go back to work enough just so that I could defer RMDs on a 401(k). That seems to be defeating the purpose of retiring."


oh, and I forgot this....

https://www.youtube.com/watch?v=FshU58nI0Ts

...with apologies to those that get offended
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My preference is to never have to touch my tax-defferred accounts..or as little as possible, and pass that on to others.

Unless you're planning on dying before Dec 31, 2019, given the SECURE Act bill that is wending it's way through Congress (with a pretty impressive 417-3 win in the House, and the Senate indicating that they will pass the House version), you might want to rethink the strategy of passing your tax-deferred accounts on when you die. With the exception of beneficiaries who are spouses or minor children, all inherited retirement accounts will need to be completely distributed within 10 years of the original owners death. See this thread https://boards.fool.com/first-rmd-to-move-up-to-age-72-34214...

That means, if one of your kids who happens to be in their prime earning years inherits $1MM in a tax deferred account from you, they will need to increase their income by $100k/year (on average, with no growth) for the 10 years after your death. Adding that much income each year would potentially bump them into a much higher tax bracket, probably higher than the one you would be bumped into if you took the RMDs.

AJ
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all inherited retirement accounts will need to be completely distributed within 10 years of the original owners death.

Will this apply to existing inherited IRAs?
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Will this apply to existing inherited IRAs?

No. Only to IRAs inherited after Dec 31, 2019.

AJ
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