The IRS proposes changes to qualified retirement plan required minimum distributions (RMDs)
The proposed changes are being made in an effort to account for 2021 projected mortality rates which predict longer life spans than the mortality rates used in current legislation. These changes, if adopted will apply to distributions for calendar years after January 1, 2021.
The changes move the life expectancy for a 70-year old from the current rate of 27.4 years to a new life expectancy rate of 29.1 years. Additionally, a 75-year old surviving spouse and sole beneficiary’s life expectancy rate changes from the current 13.4 year rate to 14.8 years.
Public comments are being accepted until January 8, 2020. The IRS plans to hold a public hearing on the proposed changes on January 23, 2020.
For details about these changes, and changes to other plans like defined benefit plans, may be found at the Federal Register, here.