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I, and my wife, have multiple IRA, ROTH IRA, Sep IRA, Rollover IRA and 401K accounts. I am 64, my wife is 58. I am planning to retire between 70 and 72. I was wondering how our MRD will be computed and is there is a site or an equation that gives our MRD.

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Publication 590 (note my link is to 590b which offers advice on the withdrawal side 590a covers deposits) offers the chart for this. Each year a 70.5 or older person has an RMD, a percent of retirement accounts based on end of prior year balance.

The math is not too tough. The 401(k) is treated as a separate entity. No RMD as long as you work. Then RMDs based on the account balance. All IRAs can be added up, RMD calculated, and the withdrawal made for that amount from any account.

rmd chart

This is the first decade. It's given as a divisor, i.e. Take the balance and divide by the number for the RMD that year. You can see how it grows, the RMD becoming a higher percent as you get older.

Two side notes - play with a spreadsheet, do the math. Project out ten years. If RMDs are likely to push you to a higher bracket, consider using Roth conversions to pull in some income, and "top off" your existing bracket. You'll build up Roth accounts at a lower marginal rate and have access to the money including growth, after five years. Second - the prior advice may fail if either of you wind up in a nursing home. The cost becomes a medical write off and effectively tax free (there's some math to do, cost has to exceed a percentage of income and standard deductions, etc, and then it's all a write off.)

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  • Thanks for the comprehensive response. Based on this response, it looks to me that at my age and tax bracket contributing to IRA is not that desirable anymore since I do not get any tax break by contribution to IRA and I am not qualified to contribute to Roth. The only benefit of IRA is tax free accumulation of gains in the remaining six years and I am not sure if this is worth it given the RMD.
    – per
    Aug 21, 2016 at 23:42
  • @per - The non-deducted future deposits can still help, they become part of the math for conversions or withdrawals. e.g. You have $450K in pretax IRA money and $50K post tax. A withdrawal or conversion is taxed on only 90% of the funds, take out (or convert) $50K, and the tax is computed on $45K, not the full $50K. You are no worse off for putting the money in the IRA. Aug 22, 2016 at 2:57

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