5 Ways to Reduce Your Required Minimum Distributions
Tax-deferred retirement account contributions reduce your taxable income for the year, but you don't get out of paying taxes on that money indefinitely. Even if you don't really need to withdraw these funds in retirement, the government forces you to once you turn 70 1/2. The amount you must withdraw is your required minimum distribution (RMD), and it depends on your retirement account balance and your age. You can calculate your RMD by dividing each retirement account balance by the distribution period next to your age in this worksheet.
RMDs might force you to withdraw more money from your accounts than you want to, but failing to take them results in a 50% penalty on the amount you should have withdrawn, so it's not a smart option. The best thing you can do is take steps to reduce them using one or more of the strategies below.
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Source Fool.com
