My birthday is 1 July 1941. Will I become 70 1/2 on Dec 31, 2011, and be required to begin minimum withdrawals from Traditional IRA in 2011; or will I become 70 1/2 on Jan 1, 2012, and not have to begin withdrawals until 2012? – Robert


We enjoy the nice round numbers the IRS uses, too. Since the IRS defines 701/2 as the date six calendar months after the date of your 70th birthday, you just missed the cut-off! You’ll be 70 ½ on January 1, 2012. That means your first required minimum distribution (RMD) will be in 2012. Or since it’s your first RMD, you could actually put it off until no later than April 1, 2013. If you decide to push your 2012 distribution back to 2013, be aware that you’ll have to take two distributions in 2013 – both the 2012 distribution and the 2013 distribution. This may make sense if you expect your income to be significantly lower in 2013; hence your tax bill may be lower. But either way, don’t forget to take your RMD because the IRS penalty for failing to do so is a whopping 50 percent!