The IRA distribution tables are based on the age you reach on your birthday during the calendar year. Say you will be 74 in 2003; that would be your age for calculating your required minimum withdrawal by December 31, 2003.
Under the Uniform Distribution Table, which the IRS released in 2002, a 74 year-old with a beneficiary usually has a joint life expectancy of 23.8 years. In 2003, you’d have to take out at least 1/23.8 of your IRA balance, or 4.202 percent.
That fraction is applied to your IRA balance at the end of the previous year. If you had $100,000 in your IRA at year-end 2002, you’d divide that by 23.8. Thus, in 2003 you’ll have to take out at least $4,202 to avoid a 50 percent penalty on any shortfall.
If your beneficiary is your spouse and she is more than 10 years younger than you are, your required distribution will be lower. However, if you wish you can take out a larger amount from your IRA.
