tomandjerry [response to 3 year old second question as follows]
"Thanks. Your answer makes perfect sense. But I have a couple of additional follow-on questions. (1) Does MA have any sort of Required Minimum Distribution requirement like the FEDs do (at age 70 1/2)? I suspect not since MA already collected tax on the amounts put into your IRA(2) How does MA treat distributions that are taken as QCD and sent directly to a non-profit. Does MA require that these be included as income (to the extent that they exceed the IRA basis)?"
- MA DOR having not taxed any contributions to a Traditional IRA does not have an RMD, and does not assess tax on any of the contributions but does assess tax on earnings received within the IRA when those earnings are distributed. Note MA DOR assumes that distributions are first the previous contributions and only when those are fully paid out, the remaining distributions are assessed as taxable earnings.
- MA follows the Federal rules on QCD. However, again, note that if the funds in whole or in part were original contributions, those funds were taxed at time of earning and are not taxed in any case on distribution. See the above note on timing sequence, as it may be the case that a QCD where funds paid over to the charity are wholly original contributions leaving the balance in the IRA as taxable earnings.
If this posted response is useful to you, please click on the upraised hand in the lower left of this post. Thank you. Scruffy Curmudgeon--PFFM/ IAFF, retired FireFighter/Paramedic - Locals 718/30, Veteran USAR O3 AIS/ASA '65-'67
NOT INTUIT EMPLOYEE
USAR 64-67 AIS/ASA MOS 9301 - O3
- Just donating my time
**Say Thanks by clicking the thumb icon in the lower left corner -it means nothing but makes those than answer feel wanted.
