2009 Required Minimum Distributions Waived

President Bush has signed The Worker, Retiree, and Employer Recovery Act (H.R. 7327) that suspends the need to take required minimum distribution (RMD) payments from defined contribution retirement plans and IRAs for the 2009 tax year. The President signed the measure on December 23, 2008, following unanimous approval in Congress earlier in the month.

Under the law, RMD payments will not be required from IRA accounts and defined contribution plans, such as 401(a), 401(k), 403(b) and governmental 457(b) plans, for 2009. Participants who attain age 70½ in 2009 (who would have previously been required to take a 2009 RMD payment by April 1, 2010) are not required to receive an RMD payment for 2009.

However, the law does not eliminate the RMD requirements for 2008. Accordingly, participants who attained age 70½ in 2008 are still required to receive an RMD payment by April 1, 2009. These individuals will not be required to receive an RMD payment for the 2009 tax year.

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