How Does a 2020 IRS Change Impact 2022 Retirement Account Required Minimum Distributions

The IRS recently issued new life expectancy tables for calculating required minimum distributions (RMDs) from IRA and employer retirement accounts. The three applicable tables have been updated to reflect increased life expectancies. They are effective January 1, 2022. 

The tables affected are:

• The Uniform Lifetime Table. This table is used to calculate lifetime RMDs for an account owner's own IRA or retirement plan.
• The Joint Life and Last Survivor Expectancy Table. This table is used instead of the Uniform Lifetime Table when a spouse is the sole IRA or plan beneficiary, and that spouse is more than 10 years younger than the plan owner or plan participant.
• The Single Life Expectancy Table. Eligible designated beneficiaries (EDBs) — a surviving spouse, a disabled or chronically ill individual, an individual who is not more than 10 years younger than the IRA owner, or a child of the IRA owner who has not reached the age of majority — may elect to use this table based on their age in the year after the IRA owner's death.

The new life expectancy tables reflect increases in life expectancies since the last tables were issued nearly 20 years ago. For most individuals, the change will be modest and account owners may not notice the difference. Even so, those responsible for calculating required minimum distributions should review the transition rules and the impacts that the new tables will have on distributions for 2022.