Be sure to take required minimum distributions (RMDs) by year end, if required. If you’ve reached age 70 1/2, take your 2016 RMD from IRAs, 401(k)s or other employer-sponsored plans. Failure to take an RMD can result in a penalty of 50% of the amount of the RMD not withdrawn. If you turned age 70 1/2 in 2016, you can delay the 1st RMD to 2017. However, if you take the deferral route, you’ll have to take a double distribution in 2017 (the 2016 amount plus the 2017 required amount). That may make sense if you’ll be subject to a lower tax rate next year.
