Reaching 70.5 age and IRA/Keogh Plans

From: ldavis@ix.netcom.com (Lynn R Davis)
Subject: Reaching 70.5 age and IRA/Keogh Plans
Date: Mon, 21 Sep 1998 10:28:53 -0500 (CDT)

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"Marshall Farr" <farrm@cpcug.org> wrote:

	I was 70 in June 98, and I know I have to start divesting myself of
some of my IRA and Keogh investments.  Can someone point me to an
appropriate web site (or any other source of definitive info) that
gives an understandable explanation of the process and the actuarial
choices one has to select from?  What forms need to be filed?  I
assume one gets them from IRS, but I wrote them over 5 weeks ago, and
haven't received a response of any kind.  Are all tax-deferred
retirement investments such as IRAs and Keoghs counted together in
order to compute the current value of one's relevant investments?  As
of what point in time does one figure that current value?
	Do any of the large fund operations such as Dreyfus, Vanguard,
Fidelity, etc issue any free or low-cost booklets that explain how,
when and what?  Thanks.

Marshall Farr <farrm@cpcug.org>

Lynn Davis responded:

The IRS publications on IRA's (not sure the pub number, but the people at the 
tax forms line will know) is available for FREE, and has the info you want.

You must withdraw (and recognize for tax purposes) a certain percentage of 
your TOTAL IRA holdings THIS year based upon their total value as of 12/31 of 
LAST year.  

There are, as I recall, several choices on how to count "life expectancy", 
which depend in part upon the age of your beneficiary, if any.

The same rules PROBABLY apply to your Keogh, EXCEPT that a Keogh is by 
definition its own pension plan and may have additional rules contained 
within its governing documents.  So, you may need to consult those plan 
documents as well.

With my father, we don't file any special reports.  We simply make sure that 
the withdrawls each year equal at least the minimum calculated as the total 
value as of the previous year end divided by his IRS "life expectancy", and 
we found all of the information on how to do it in free IRS publications.

Lynn Davis
Fremont, CA


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