Today’s Federal Register includes IRS final regulations providing updated life expectancy tables. These tables are to be used when calculating required minimum distributions (RMDs) from IRAs and other tax-qualified retirement savings arrangements, such as 401(k) plans. Those affected will include IRA owners, plan participants, beneficiaries, and employer-sponsored retirement plan administrators.
These final regulations take effect today, with publication in the Federal Register, but the life expectancy tables they contain will not be used for calculations until distribution calendar years beginning January 1, 2022.
The purpose of these new life expectancy and distribution tables is to ensure that future required payments from retirement savings arrangements better reflect actual life expectancies of those who receive such payments.