Expert: Ed McFarland - 1/4/2005

Question
I will be 70 1/2 shortly & need to know how much must I take out a yr so I do not get any penalty. I have about $85,000 in my 401K rollover from my employer.  What is the formula/ how do I figure how much I MUST take out ea. year. Thanks much! My wife has one but she is 4 yrs younger so we intend to just leave hers ride until she is 70 1/2.

Answer
IF you are retired, I would suggest rolling the 401k into an IRA. There are estate and other planning issues that are better handled with the IRA then the 401k.

Even if you don't do that, the service provider will provide you with the Required Minimum Distribution (RMD), the chart for seeing what the number should be can be found searching www.irs.gov If the service provider won't do it, then roll it over to somebody who will.