fb-rmd-0026
{
"person": "Traditional IRA owner, age 79, with a $22,000 required minimum distribution for the calendar year on his only IRA",
"facts": "In July, the owner moves the entire IRA to a new custodian by direct trustee-to-trustee transfer; nothing is paid to the owner. He takes no other amounts from either account during the year. His new advisor tells him the transfer 'emptied the old account, so its RMD is done.'",
"question_context": "Whether the transfer satisfied the year's required minimum distribution."
}Did the trustee-to-trustee transfer satisfy this owner's required minimum distribution for the year? Answer with exactly one option id.
no-rmd-still-required— No — a trustee-to-trustee transfer is not a distribution, and the transferor IRA's RMD must still be satisfiedyes-transfer-satisfies— Yes — the transfer moved more than the RMD amount out of the transferor IRAyes-if-reported— Yes, provided the transfer is reported as a distribution on Form 1099-R
no-rmd-still-required
26 CFR 1.408-8(d)(4) provides that a trustee-to-trustee transfer between IRAs is not treated as a distribution by the transferor IRA for section 401(a)(9) purposes, and that the transferor IRA's minimum distribution requirement must still be satisfied. Moving the account therefore satisfied nothing; the $22,000 RMD remains due (and after the transfer can be taken from the transferee IRA).
Selects no-rmd-still-required, citing 1.408-8(d)(4).
“the transfer is not treated as a distribution by the transferor IRA for purposes of section 401(a)(9). Accordingly, the minimum distribution requirement with respect to the transferor IRA must still be satisfied.”
Each quoted passage is exact-matched, after typographic normalization, against the corpus text fetched from the issuing authority (hashes in the corpus manifest). An item whose quote stops matching fails the build.
“the transfer is not treated as a distribution by the transferor IRA for purposes of section 401(a)(9). Accordingly, the minimum distribution requirement with respect to the transferor IRA must still be satisfied.” — cfr-1-408-8
The answer key correctly identifies that a trustee-to-trustee transfer is not considered a distribution for the purposes of satisfying the required minimum distribution under section 401(a)(9). The cited regulation explicitly states that the minimum distribution requirement for the transferor IRA must still be satisfied.
“the transfer is not treated as a distribution by the transferor IRA for purposes of section 401(a)(9). Accordingly, the minimum distribution requirement with respect to the transferor IRA must still be satisfied.” — cfr-1-408-8
The regulation expressly states that a trustee-to-trustee transfer between IRAs that is not a distribution and rollover is not treated as a distribution by the transferor IRA for section 401(a)(9) purposes, and the transferor IRA's minimum distribution requirement must still be satisfied. Therefore, the transfer did not satisfy the owner's $22,000 RMD; the option 'no-rmd-still-required' is correct.
v1; no errata. Demonstrate a key error and the correction is published here, credited — challenge policy.