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McCurrie McCurrie
& McCurrie, L.L.C.

680 Kearny Avenue
Kearny, NJ 07032-3010
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Deadline Approaching for Annual IRA Withdrawals

With all of the end-of-year financial and estate planning news surrounding the estate tax, health care spending, and Social Security proposals, one important issue you may have missed was arranging for your annual IRA withdrawal. If you are required to take a withdrawal and haven't done so already this year, you need to act quickly to make sure you don't face some steep tax consequences.

Typically, those with IRAs who are 70.5 or older are required to take a minimum distribution each year. Last year, however, legislation was passed allowing individuals to skip that requirement if they wished. The intent of lawmakers was to allow those that had lost money due to the recession to leave extra money in their IRAs with hopes of generating some of those losses back.

Last year, many took advantage of the opportunity to skip distributions and let their money grown in the IRAs. What many may not have realized is that the legislation allowing the skipping of distributions only lasted one year. In 2010, those required distributions are back and the failure to take them could result in a large tax bill.

For most individuals the deadline for taking a distribution is December 31. If not taken by then, the IRA owner could be taxed 50% of the amount that should have been withdrawn. Since it may take some time to process the withdrawal request, you should act now if you still haven't taken your distribution.

If you have questions about what you need to do, or if you have other concerns about estate plans and changes you need to make by the end of the year, you should consider contacting an experienced estate planning attorney to discuss your plans.

Source: USA Today, Don't forget to take that IRA distribution before year's end, Sandra Block 12/7/10

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