Phil Marti wrote:
- quote -


Happy New year, y'all,
and ChEAr$,
Harlan

--
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Harlan Lunsford wrote:
- quote -

withdrawals at age 70 to be suspended).

The Treasury Secretary does have the authority to alter the RMD
rule for 2008. Announcing today (the 30th of Dec.) that you don't
have to take it in 2008, is of very little to no value to anyone
as I have to assume that a very large majority have already taken
100% of the RMD.

How do you handle those taxpayers who have already taken their
RMDs? For certain types of accounts (self-directed IRAs for
example), it is probably a ho-hummer as these types of accounts
are equipped to accept contributions. For any employer type plan,
it is both a practical and administrative nightmare as they are
not equipped to take direct contributions from retirees. And keep
in mind that there are taxpayers who are not age 70 1/2 that also
have an RMD requirement. Think inherited.

The problem has two components. The amount of the distribution
for those whose investments were heavy in securities represents a
large portion of their 2008 year-end balance and one has to pay
tax on the distribution.

Therefore, it seems to me that there are only two options to
ameliorate the situation. Electing to forgo taxing the 2008 RMDs
would help and I don't see any significant issues implementing
this. Elect to treat 2008 as business as usual and implement a
2009 plan by allowing one to redeposit the 2008 RMD into a
self-directed IRA account with a tax deduction for the
contribution. This would help restore the retirement plan balance
and by providing a tax deduction for the contribution you
eliminate double taxation.

--
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"Paul Thomas, CPA" wrote:

- quote -

For those who have not yet taken the 2008 RMD, administratively waive the
penalty using existing statutory authority.

For those who already took it, there's some wiggle room in the Code which
could be used to justify extending the 30 day rollover period. This would
result in the effect of no RMD having been taken, which puts us back to
waiving the penalty.

The rollover option is dodgy legally, but who would challenge it?

But it seems to me that it ain't gonna happen since I'm sure there are
people at Treasury who could find the same options I did. They just decided
not to do it.

--
Phil Marti
Clarksburg, MD

--
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"Harlan Lunsford" <lunstax[at]bellsouth.net> wrote in message
news:BNg6l.158$vs6.125[at]bignews7.bellsouth.net...
- quote -


I read in the newspaper that it will apply to 2009's RMD, not 2008's

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"Harlan Lunsford" <lunstax[at]bellsouth.net> wrote
- quote -





There is some saying about too many cooks spoiling the broth, and we've got
a tad over 500 Congresscritters cooking up tax law. They are politicians,
so it'll work the most confusing way possible.

The reality to suspend RMD for 2008 is doable, just pass a law on December
31st at 11:59:50 pm. UN_doing the RMD's that have been previously made
isn't going to happen. But for those who haven't taken it yet.....

Then it's just a sound bite for the evening news.




--
Paul A. Thomas, CPA
Watkinsville, Georgia

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John H. Fisher wrote:
- quote -

(snipped a bit here...)

For that last item, just how would that work? Most people, me
included, have already gotten theirs this year. Except for one client
who "forgot" and was in today for me to figure his so he could hurry and
call them to send him a check post haste.

ChEAr$,
Harlan Lunsford, EA n LA

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CCH Tax News Headlines - December 29, 2008

Federal Headlines: - http://tax.cchgroup.com/news/headlin...ws122908.htm#1

12/29/2008 - IRS Issues Proposed and Temporary Regulations Regarding
Employment Tax Returns and Deposits (T.D. 9440; NPRM REG-148568-04)

12/29/2008 - IRS Releases Final Form 990 and Instructions for Tax-
Exempt Organizations

12/29/2008 - Lawmakers Ask Bush to Suspend RMDs for 2008

State Headlines:

12/29/2008 - Missouri --Personal Income Tax: Credit Allowed for Texas
Margin Tax and Michigan Business Tax Paid

12/29/2008 - New York City --Corporate Income, Miscellaneous Taxes:
Limitations on SUV Depreciation Explained

Missed a headline? Click here for last week's tax highlights. -
http://tax.cchgroup.com/News/TaxNews...t.asp?PageID=4

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >