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Question for the Money Doctors

Question submitted on Jan 21, 2013.

Question

I have a IRA brokerage account. I will have to start taking RMDs soon. I currently live on the dividends in my IRA. If I sell some of the stock for RMD I lose that income. Would it be advantageous to take RMD in kind value of the stock and put that into my regular brokerage account and continue to collect the dividends??

Answer

Taking your RMD in kind using the stock you currently use the dividends from as income is fine. You might want to liquidate and purchase higher dividend yielding stocks to create additional income. You also must take into consideration the additional tax effect on taking your RMD which is a taxable event.


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