My wife and I recently moved from California to Montana on July 31, 2023. My question is how is the Required Minimum Distribution (RMD) of my IRA treated for 2023 as a result of the move?
Do I (1.) Divide the distribution between the two states proportional to our residential duration, i.e., 7/12ths for CA and 5/12ths for MT, or (2.) Apply the entire distribution to one state, and none to the other. If so, which state receives the entire distribution. The RMD was earned and calculated while being a resident of CA, but will be entirely dispursed while a resident of MT.
You moving from one state to the other doesn't change the amount of your RMD.
Distributions from retirement accounts are income in the state in which you resided at the time of the distribution, which I believe you say will be Montana. Check California's and Montana's definition of being a resident of the state.
@rvblanton it'll work itself out when you file both a part year resident form for CA and for MT. Since you took the distribution after 7/31, it'll be reported to MT.