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Discussion:Qualified Plan -- RMD - Definition of Retired

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Discussion Forum Index --> Advanced Tax Questions --> Qualified Plan -- RMD - Definition of Retired


Discussion Forum Index --> Tax Questions --> Qualified Plan -- RMD - Definition of Retired

R2 (talk|edits) said:

8 November 2011
A non 5-percent owner can defer his required beginning date to April 1 of the calendar year following the later of:

(I) the calendar year in which the employee attains age 70 1/2, or

(II) the calendar year in which the employee retires.

What is the definition of his retirement date? If he wotks 10 hours per week, is he retired?

Michaelstar (talk|edits) said:

8 November 2011
Natalie Choate in her book "Life and Death Planning for Retirement Benefits" 7th edition, 2011 specifically addresses this same question on page 54. There she refers to Reg ยง1.401(a)(9)-2 which you have defined above.

She also states that she has found no specific guidance on your question. She specifically points out that Notice 97-75, 1997-2 C.B. 337 link:http://benefitslink.com/src/irs/notice97-75.html does not say anything on point. I wish I could have helped you out more on this.

For those who do not have her book in your library as reference - both Death & Taxes (as David has also previously recommend this many times)and myself highly recommend this.

R2 (talk|edits) said:

8 November 2011
Thank you Michaelstar. In this case, the employee is working 15 hours per week,and I am going to say that he is not retired.

Michaelstar (talk|edits) said:

8 November 2011
I would concur as there is no "separation from service" for this employee from this employer.

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