The IRS has posted a preview of the final regulations (TD 9930) which sets forth final regulations providing guidance relating to the life expectancy and distribution period tables that are used to calculate required minimum distributions (RMDs) from qualified retirement plans, individual retirement accounts and annuities, and certain other tax-favored employer-provided retirement arrangements. These regulations affect participants, beneficiaries, and plan administrators of these qualified retirement plans and other tax-favored employer-provided retirement arrangements, as well as owners, beneficiaries, trustees and custodians of individual retirement accounts and annuities.
Under the final regulations, the updated tables, which reflect longer life expectancies, are to be applied for distribution calendar years beginning January 1, 2022. A transition rule is also included in the final regulations that allows certain beneficiaries who began distributions prior 2022 to do a one-time reset of life expectancy using the new updated tables. Also, under the final regulations, taxpayers who are receiving substantially equal periodic payments that are calculated under the required minimum distribution method will not be treated as modifying the series of payments if the taxpayer applies the new tables.
These regulations are scheduled to be published in the Federal Register on November 13, 2020.