If I take an IRA distribution

Ideliver416
Ideliver416 Member Posts: 1 Newcomer
in Filing my taxes

If I request IRA distribution on December 26 2023 but it isn't deposited into my bank til Jan 1st 2024 what year is income reported?

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  • MatthewD
    MatthewD FreeTaxUSA Team Posts: 340
    Answer ✓

    That is a great question and follows the IRS "Constructive Receipt" doctrine, which basically means you report income in the year you had control of and access to it. However, if you get a Form 1099-R for 2023, I highly recommend you report it on your 2023 tax return, since the IRS will expect it to be reported for tax year 2023.

    Unless you really need to report it in 2024 and are ready to explain to the IRS why it was reported on a later year, report it in 2023.

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  • joemaria
    joemaria Member Posts: 1 Newcomer

    I will be 73-yrs. old in April 2024, under the new RMD rules when will I be required to take my distribution and for what tax year.

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  • MatthewD
    MatthewD FreeTaxUSA Team Posts: 340
    edited November 2023

    Hi JoeMaria,

    Prior to 2023, the RMD requirement happens in the year you turn 72. However, there have been some changes and beginning in 2023 the age was increased to 73.

    Here's what the IRS states, "Beginning in 2023, the SECURE 2.0 Act raised the age that you must begin taking RMDs to age 73. If you reach age 72 in 2023, the required beginning date for your first RMD is April 1, 2025, for 2024. Notice 2023-23 permits financial institutions to notify IRA owners no later than April 28, 2023, that no RMD is required for 2023."

    So, your first RMD, based on what you have told us, must be taken by April 1, 2025, for 2024. For more information and details, see this IRS page on IRA Required Minimum Distributions.

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