Seniors age 70 1/2+: Take your required retirement distribution

The tax laws generally require individuals with retirement accounts to take annual withdrawals based on the size of their account and their age beginning with the year they reach age 70½. Failure to take a required withdrawal can result in a penalty of 50% of the amount not withdrawn.

If you turn age 70½ in 2018, you can delay your 2018 required distribution to 2019. Think twice before doing so, though, as this will result in two distributions in 2019 — the amount required for 2018 plus the amount required for 2019, which might throw you into a higher tax bracket or trigger the 3.8% net investment income tax. On the other hand, it could be beneficial to take both distributions in 2019 if you expect to be in a substantially lower tax bracket in 2019.

401(K) RETIREMENT PLAN CONTRIBUTION LIMIT INCREASES FOR 2018; MOST OTHER LIMITS ARE STAGNANT

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