Taxes on Retirement Plan Distribution after age 70 1/2

Once you turn 70½, you must take withdrawals from your retirement plans. The IRS specifies the minimum amount you must take each year. Failure to make minimum withdrawals can result in severe tax penalties. The IRS requires that you take at least the amount equal to thebalance in your retirement account at the end of the prior year divided by the number of years you are expected to live based on actuarial tables approved by the IRS. For example, if you are 72 years old and had $500,000 in your retirement account on December 31 last year, your minimum required distribution this year would be this:

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