In 2009 Congress changed the rules on distributions from retirement plans for people over 70 ½ which said that they could skip taking a distribution if they so desired. Unfortunately, Congress did not extend the waiver beyond 2009 so required minimum distributions from IRAs and plans resume this year. Taxpayers that turned 70½ in 2009 needn’t take any payout for 2009 by April 1, 2010, but they must take a distribution for 2010 by Dec. 31, 2010. Withdrawals for 2010 are based on Dec. 31, 2009 balances.
Heirs stuck with the five-year payout period get an extra year because the five-year span is calculated without regard to 2009. So if an IRA owner died in 2004, heirs have until Dec. 31, 2010 to clean out the IRA.
