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I have a traditional IRA account (holding stocks, funds, etc.) and a separate IRA account holding a variable annuity. The annuity will eventually provide the larger of either a guaranteed minimum distribution (protected withdrawal value) or a distribution based on the actual contract value. I am currently in my sixties and have not taken any IRA distributions. I will not start annuity distributions until my mid-seventies, after my RMDs have started.
My questions are:
1) When I take my first RMD at 70 1/2, that RMD will come completely from my traditional IRA account (I will not yet have started distributions from my IRA annuity). Is the RMD based solely on the value of my traditional IRAaccount? If not, then I assume the IRA annuity plays some role in determining the value of my IRA accounts, what "value" of the IRA annuity do I useto find the total value of my IRA accounts?
2) Later, once distributions from my IRA annuity have started (do you say it has become "annuitized" at this point?), I understand that some tax professionals advise their clients to combine the "values" of their traditional IRA and IRA annuity accounts so that the annuity distribution can be used to lessen distributions from the traditional IRA account. Is there any IRS position on this? If not, would such a strategy be considered low or high risk?
I am preparing to meet with my financial and tax professionals on this subject and wanted to have a basic understanding of the matter before I walk in....TIA, Ron
My questions are:
1) When I take my first RMD at 70 1/2, that RMD will come completely from my traditional IRA account (I will not yet have started distributions from my IRA annuity). Is the RMD based solely on the value of my traditional IRAaccount? If not, then I assume the IRA annuity plays some role in determining the value of my IRA accounts, what "value" of the IRA annuity do I useto find the total value of my IRA accounts?
2) Later, once distributions from my IRA annuity have started (do you say it has become "annuitized" at this point?), I understand that some tax professionals advise their clients to combine the "values" of their traditional IRA and IRA annuity accounts so that the annuity distribution can be used to lessen distributions from the traditional IRA account. Is there any IRS position on this? If not, would such a strategy be considered low or high risk?
I am preparing to meet with my financial and tax professionals on this subject and wanted to have a basic understanding of the matter before I walk in....TIA, Ron