Is A Pension A Qualified Retirement Plan?

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   James E. Tome

   Yes a pension is a qualified plan. Meaning you have not paid taxes on that money, so when you begin to take disbursements, it will be taxable @ your current income bracket. If you have not taken any distributions, you will be required to take a Required Minimum Distribution, or "RMD", the year following your 70 & 6 months birthday.If you want to pass that money on to a beneficiary rather than use the money yourself. You can convert that fund to a Roth IRA, pay the tax now, & pass the money on to your beneficiaries later on.No RMD required in a Roth IRA. A living trust is the best instrument to insure that your wishes are carried out to the letter. A will is simply instructions to the probate court.

   Answered on June 12, 2013

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