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Old 09-09-2008, 10:51 PM
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What happens if a taxpayer neglects to take a minimum distribution at Age 70 1/2?

If a taxpayer neglects to take out the minimum required distributions or withdrawals by the required beginning date, or the taxpayer does not take out a sufficient amount, than the taxpayer would be assessed a hefty penalty of 50% on the difference between what he took out and what he should have taken out.

Therefore, it is imperative for Seniors to have a very good understanding as what should be the required minimum distribution amount when he or she turns Age 70 1/2 in order to avoid this potentially huge penalty.

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