Required minimum distribution form (RMD)
Here’s what it is:
If you have a qualified account, federal tax law requires that you take a minimum distribution each year once you reach a certain age. Since this amount can be different each year, John Hancock will calculate the amount you are required to withdraw. An RMD applies to most types of qualified retirement plans, including, but not limited to: Traditional IRAs, SEP IRAs, SIMPLE IRAs, 401(k) plans, 403(b) plans, 457(b) plans, profit-sharing plans, and other qualified pension or retirement plans.
Here’s when to use this form:
An RMD usually must be taken from your retirement account no later than April 1 of the calendar year after the calendar year you turn a certain age. A distribution must then be taken at least once annually every year after that, no later than December 31. This is required by the Internal Revenue Code. For individuals born before July 1, 1949, minimum distributions are required after reaching age 70½. For individuals born after June 30, 1949, and before January 1, 1951, minimum distributions are required after reaching age 72. For individuals born after December 31, 1950, minimum distributions are required after reaching age 73.
Here’s what to do:
Use this form to ensure that you withdraw the correct amount to satisfy the legal requirement. John Hancock will send you the calculated RMD amount for your contract for the applicable tax year. When an IRA owner holds multiple contracts, he/she can take an aggregate RMD from one contract. However, we compute only the RMD for our contract. You can choose to either make a one-time withdrawal for the current tax year or schedule recurring automatic withdrawals from your annuity contract so that in subsequent years, you’ll never have to worry that you haven’t withdrawn enough.
Watch our RMD video
Take a look at our most frequently asked questions:
How much do I need to withdraw?
Generally, the RMD amount is calculated based on the value of your account as of 12/31 of the previous year and a life expectancy factor that is taken from the IRS Uniform Lifetime Table or IRS Joint Life Expectancy Table, if your spouse is the only primary beneficiary and he or she is 10 years younger than you. Because both of these numbers can change year-to-year, your annual RMD amount may also change. John Hancock will automatically calculate the amount of your RMD every year.
What happens if I do not take an annual RMD or mistakenly take less than my RMD?
If you fail to take your RMD, you may be subject to an excise tax equal to 50% of the amount that should have been distributed but was not. The Internal Revenue Service (IRS) may waive the excise tax if you establish that you did not take your full RMD due to a reasonable error and that reasonable steps were taken/are being taken to withdraw the full amount required. To request a waiver of the excise tax, you must file IRS Form 5329 with your income tax return and attach a letter of explanation (instructions may be found at www.irs.gov). Please consult with your own tax professional for guidelines specific to your situation.
What taxes apply to my RMD?
RMDs are generally subject to federal income tax and applicable state income tax. However, if you have after-tax contributions, part of your RMD will be treated as a non-taxable return on a portion of those contributions. Please consult with your own tax professional for guidelines specific to your situation.
Can I view my RMD online?
Click here to view John Hancock’s Required Minimum Distribution (RMD) Guide: All you need to know about your RMD.
How is my RMD calculated?
Generally, the RMD amount is calculated based on the value of your account as of 12/31 of the previous year and a life expectancy factor that is taken from the IRS Uniform Lifetime Table or IRS Joint Life Expectancy Table, if your spouse is the only primary beneficiary and he or she is 10 years younger than you. Because both of these numbers can change year-to-year, your annual RMD amount may also change. John Hancock will automatically calculate the amount of your RMD every year.
This information is not intended to serve as, and does not constitute, tax advice. Please contact your own tax professional with any questions about your personal tax situation.
John Hancock Annuities are issued by John Hancock Life Insurance Company (U.S.A.), Lansing, MI 48906, which is not licensed in New York. In New York, John Hancock Annuities are issued by John Hancock Life Insurance Company of New York, Valhalla, NY 10595. John Hancock Variable Annuities are distributed by John Hancock Distributors LLC.
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