Bill in Congress HR 8331

[Michael G.]

HR 8331 would waive required minimum distributions for the 2022 tax year. That’s a nice way of saying Uncle Sam would not force older folks to withdraw more money than necessary from their retirement accounts this year. :thumbup:

Contact your state Representative.
Daniel Webster in Marion County

[Dr Winston O Boogie jr]

What else is in this bill?

[Kahuna32162]

well, we're already halfway thru the 2022 tax year and RMD's have already been distributed for the last 7 months. Too little, too late.

[retiredguy123]

well, we're already halfway thru the 2022 tax year and RMD's have already been distributed for the last 7 months. Too little, too late.
If this year (2022) is your first RMD, you have until April 1, 2023 to take it. If it is not your first RMD, your have until December 31, 2022. So, if you have already taken all or part of your RMD for 2022, you took it earlier than you needed to.

[bob47]

Given what the markets were at on December 31, 2021 when the RMD was calculated and what they'll probably be at on December 31 this year, that bill would be a big relief for a lot of folks.

[retiredguy123]

If passed, I would take advantage of the law, but I don't support it. It will just raise the National debt. We need to pass laws that will reduce the debt.

[jebartle]

If passed, I would take advantage of the law, but I don't support it. It will just raise the National debt. We need to pass laws that will reduce the debt.

Let me be careful, how long ago was the debt reduced, I know, do you?

[Caymus]

If passed, I would take advantage of the law, but I don't support it. It will just raise the National debt. We need to pass laws that will reduce the debt.

Wouldn't the IRS take more money long term if taxpayers sold in an up market?

[Keefelane66]

A synopsis of HR8331 seems to defer start date not for accounts already being withdrawn.
Introduced in House (07/12/2022)
“This bill suspends in 2020 and 2022 the required minimum distribution rules for defined contribution retirement plans or individual retirement plans. Under current law, participants in tax-exempt retirement plans must begin making distributions of plan amounts at the required beginning date (i.e., April 1 or the calendar year following the later of the calendar year in which the employee attains age 72, or the calendar year in which the employee retires).
Sponsor: Rep. Davidson, Warren [R-OH-8] (Introduced 07/12/2022)”
It has only been introduced not up for a vote YET.

All Info - H.R.8331 - 117th Congress (2021-2022): To amend the Internal Revenue Code of 1986 to temporarily suspend required minimum distribution rules for certain retirement plans and accounts. | Congress.gov | Library of Congress (https://www.congress.gov/bill/117th-congress/house-bill/8331/all-info)

[retiredguy123]

Let me be careful, how long ago was the debt reduced, I know, do you?
I think it was when Bill Clinton was president, but I am not sure.

[retiredguy123]

Wouldn't the IRS take more money long term if taxpayers sold in an up market?
Maybe, but who knows what the Government will do in the future?

[Boomer]

Let me be careful, how long ago was the debt reduced, I know, do you?

I think it was when Bill Clinton was president, but I am not sure.

Yes indeed, retiredguy123, it sure was.

That was also the time when the capital gains exclusion for the sale of a primary residence, after owning for two years, went into effect.

That change in the tax law helped a lot of boomers to sell houses and to not have to turn around and buy a more expensive house or pay taxes on the gain.

That change was something that helped regular people to save a lot of money…..and it still does.

Lots of people here, over the years, have sold a longtime primary residence elsewhere in the country, and then bought in TV for cash — and kept the change — tax free.

That cap gains tax law change in the late 1990s created my favorite tax law ever.

Many sellers now don’t remember how it used to be when profit on a house could be gobbled up by cap gains — before the Clinton years.

Boomer

[Luggage]

Quite true, the RMD was passed so that those Congress people who believe in keeping our deficit down would allow the ira laws to be passed. Otherwise you have income put away that would never be taxed

[Luggage]

Since we're never having a budget equal to the taxes coming in what's a few billion dollars?

Wouldn't the IRS take more money long term if taxpayers sold in an up market?

[thevillages2013]

Wouldn't the IRS take more money long term if taxpayers sold in an up market?

Better sit down when dealing with the government because someone is going to get screwed

[B-flat]

Better sit down when dealing with the government because someone is going to get screwed
.........................and it won't be the government.

[GRACEALLEMAN]

HR 8331 would waive required minimum distributions for the 2022 tax year. That’s a nice way of saying Uncle Sam would not force older folks to withdraw more money than necessary from their retirement accounts this year. :thumbup:

Contact your state Representative.
Daniel Webster in Marion County

It all depends on your age. They've already passed a law that you don't have to withdraw until you're 72 years old . Some not there yet

[Mrfriendly]

Yes indeed, retiredguy123, it sure was.

That was also the time when the capital gains exclusion for the sale of a primary residence, after owning for two years, went into effect.

That change in the tax law helped a lot of boomers to sell houses and to not have to turn around and buy a more expensive house or pay taxes on the gain.

That change was something that helped regular people to save a lot of money…..and it still does.

Lots of people here, over the years, have sold a longtime primary residence elsewhere in the country, and then bought in TV for cash — and kept the change — tax free.

That cap gains tax law change in the late 1990s created my favorite tax law ever.

Many sellers now don’t remember how it used to be when profit on a house could be gobbled up by cap gains — before the Clinton years.

Boomer


I’m guessing the Clintons owned lots and lots of property back then

[pcovella]

Let me be careful, how long ago was the debt reduced, I know, do you?

1957. We were in a recession. But I do favor serious cuts in federal spending to reduce the national debt, but more importantly to reduce the debt to GDP ratio.

[Ski Bum]

I think it was when Bill Clinton was president, but I am not sure.

You would be correct. And Newt ran the House, where all budgets originate.

[johnbarnon]

HR 8331 would waive required minimum distributions for the 2022 tax year. That’s a nice way of saying Uncle Sam would not force older folks to withdraw more money than necessary from their retirement accounts this year. :thumbup:

Contact your state Representative.
Daniel Webster in Marion County

This system, if all is to be believed will mean the end of the I.R.S. and will lead to many other benefits that the elites did not want the public to know about. You will not find any mention on Main stream media, T.V. or press, but check out on You tube or other sites that are available, there is a lot happening that you need to know about, it is a game changer.

[Lindsyburnsy]

We all have to be on alert. Several "leaders" are supporting the slow elimination of Social Security and Medicare...which, by the way, we have all paid into. While many of us can live off of our retirement savings or pensions, many people, including those who were small business owners, cannot. Be sure to get your news from more than one outlet.

[collie1228]

If this year (2022) is your first RMD, you have until April 1, 2023 to take it. If it is not your first RMD, your have until December 31, 2022. So, if you have already taken all or part of your RMD for 2022, you took it earlier than you needed to.

That's true, but if you wait until 2023 for your first distribution (technically your 2022 distribution) you will also be required to take another RMD by no later than December 31, 2023. Personally, I'd rather have the smaller effect on my tax bill by taking the RMD in each year, not both distributions in the same year.

[retiredguy123]

That's true, but if you wait until 2023 for your first distribution (technically your 2022 distribution) you will also be required to take another RMD by no later than December 31, 2023. Personally, I'd rather have the smaller effect on my tax bill by taking the RMD in each year, not both distributions in the same year.
Correct, but if your marginal tax rate doesn't change, it doesn't really matter.

[B-flat]

We all have to be on alert. Several "leaders" are supporting the slow elimination of Social Security and Medicare...which, by the way, we have all paid into. While many of us can live off of our retirement savings or pensions, many people, including those who were small business owners, cannot. Be sure to get your news from more than one outlet.

You're right on with your thoughts, this is the start of the new world and reset.

[kkingston57]

HR 8331 would waive required minimum distributions for the 2022 tax year. That’s a nice way of saying Uncle Sam would not force older folks to withdraw more money than necessary from their retirement accounts this year. :thumbup:

Contact your state Representative.
Daniel Webster in Marion County

Like this or not. It is like a 401K. Another way to push taxes paid into the future or get your inheritors to pay the taxes. Would suspect that most of us will probably pay less on a % basis than our old payroll tax rate.

Remember when my now deceased father would get a large deposit into his checking account. For 10 years I had to explain it to him.

[RICH1]

Check with your Financial Advisors ….If you can find them… Remember these bills have along way to go before they become Law!

[bp243]

If this year (2022) is your first RMD, you have until April 1, 2023 to take it. If it is not your first RMD, your have until December 31, 2022. So, if you have already taken all or part of your RMD for 2022, you took it earlier than you needed to.

For some of us, the reason that we took it earlier happened to be a wise move before this announcement anyway, since our money was worth more in January than it is today. If our withdrawal isn’t taxed that would be an even greater advantage. Unsure if that’s the case.

[Dr Winston O Boogie jr]

Let me be careful, how long ago was the debt reduced, I know, do you?

It was a few years after the 105th and 106th Congresses lowered taxes.

[rsmurano]

Why should I have to support reckless spending? We shouldn’t be spending or try to spending as much as we are especially while going into a recession. You have to ask, what got us into this high inflation/recession era? It’s all the reckless spending!

[Caymus]

Let me be careful, how long ago was the debt reduced, I know, do you?


The National Debt has not been reduced since 1957. Do you mean budget deficit?

[Haggar]

well, we're already halfway thru the 2022 tax year and RMD's have already been distributed for the last 7 months. Too little, too late.

The last time they changed the RMD age from 70 1/2 to 72 they allowed anyone who had taken a RMD already to pay it back in the year if the RMD was taken based upon the earlier requirement- effectively cancelling the withdrawal.

[Dr Winston O Boogie jr]

Why should I have to support reckless spending? We shouldn’t be spending or try to spending as much as we are especially while going into a recession. You have to ask, what got us into this high inflation/recession era? It’s all the reckless spending!

There are 535 people in Washington who are to blame for all of the problems in this country including deficit spending and the debt. Somehow they have all
gotten their constituencies to believe that it's all the other guy's fault.

The only thing that will ever fix this is term limits for congress.

[retiredguy123]

The National Debt has not been reduced since 1957. Do you mean budget deficit?
As I understand it, if the annual budget deficit is negative, then the debt is reduced. I think we had a negative deficit at some point during the Clinton years. It occurred between 1998 and 2001.

[retiredguy123]

There are 535 people in Washington who are to blame for all of the problems in this country including deficit spending and the debt. Somehow they have all
gotten their constituencies to believe that it's all the other guy's fault.

The only thing that will ever fix this is term limits for congress.
What about the people who voted for them? Don't they share some of the blame?

[justjim]

There are 535 people in Washington who are to blame for all of the problems in this country including deficit spending and the debt. Somehow they have all
gotten their constituencies to believe that it's all the other guy's fault.

The only thing that will ever fix this is term limits for congress.

Now, here is a good idea. Term limits! I don’t see a logical way for that to happen during my lifetime. Wait, you can vote them out. It’s easy to check how long served but impossible to get enough voters to cross party lines to vote them out. Stuck again.

[Langwelld]

That’s the key! What other wasteful, pork barrel, deficit building crap is in the bill?!!

What else is in this bill?

[MrChipster]

If passed, I would take advantage of the law, but I don't support it. It will just raise the National debt. We need to pass laws that will reduce the debt.

Like spending less. Lots and lots and Trillions of less.

[Topspinmo]

If passed, I would take advantage of the law, but I don't support it. It will just raise the National debt. We need to pass laws that will reduce the debt.

National debt, who cares about that….:mad:

[GatorFan]

well, we're already halfway thru the 2022 tax year and RMD's have already been distributed for the last 7 months. Too little, too late.

Not for me. I hope this goes through.

[nn0wheremann]

Let me be careful, how long ago was the debt reduced, I know, do you?
When Bill Clinton was President.

[Dr Winston O Boogie jr]

As I understand it, if the annual budget deficit is negative, then the debt is reduced. I think we had a negative deficit at some point during the Clinton years. It occurred between 1998 and 2001.

Correct. After congress lowered taxes.

[nn0wheremann]

Like spending less. Lots and lots and Trillions of less.
Agreed. So why are all these local Officials of the red persuasion complaining about over spending and inflation while tripping over themselves trying to spend all the pandemic stimulus money and Build Back Better spending passed by the federales of the blue persuasion?

[biker1]

The “Build Back Better” bill wasn’t passed.

Agreed. So why are all these local Officials of the red persuasion complaining about over spending and inflation while tripping over themselves trying to spend all the pandemic stimulus money and Build Back Better spending passed by the federales of the blue persuasion?

[Black Beauty]

get both Biden and Trump to not run in 2024. Term limits too

[mkjelenbaas]

well, we're already halfway thru the 2022 tax year and RMD's have already been distributed for the last 7 months. Too little, too late.
WRONG!! RMD’s for 2022 are taken in 2023.

[retiredguy123]

WRONG!! RMD’s for 2022 are taken in 2023.
Not exactly. Unless 2022 is your first RMD, you must withdraw your RMD for 2022 by December 31, 2022. The only way you can delay the RMD into 2023 is if it is your first RMD, in which case, you can delay the RMD until April 1, 2023. But, you can wait until December 31, 2022 and withdraw the entire RMD in a lump sum on that day. There is no need to take it earlier in the year.

[RVJim]

WRONG!! RMD’s for 2022 are taken in 2023.

Mmm no you are wrong. The RMD for 2022 is calculated from the balance on 12/31/2021 and can be taken out at anytime during 2022. The amount taken is reported on your tax return for tax year 2022.

[Lindsyburnsy]

Of course COVID pandemic had nothing to do with it.

Why should I have to support reckless spending? We shouldn’t be spending or try to spending as much as we are especially while going into a recession. You have to ask, what got us into this high inflation/recession era? It’s all the reckless spending!

[Lindsyburnsy]

I will never vote for anybody who happily has swastika waving fans as their most loyal base cheering them on. Isn’t this exactly what our fathers fought against?

QUOTE=Black Beauty;2118747]get both Biden and Trump to not run in 2024. Term limits too[/QUOTE]

[Boomer]

HR 8331 would waive required minimum distributions for the 2022 tax year. That’s a nice way of saying Uncle Sam would not force older folks to withdraw more money than necessary from their retirement accounts this year. :thumbup:

Contact your state Representative.
Daniel Webster in Marion County



I am not clear on this because the wording of the above quoted post seems to be unclear.

"It depends on what is is."

A few posters in this thread are commenting that they have already paid their 2022 RMD or most of it, so then what? A can of worms? The expense of rebates in some form?

What "is" the meaning of 2022? What is the meaning of "this" year?

The RMD is based on the IRA balance on December 31 and paid in the year following.

Therefore, surely, what this bill is saying is that no RMD would be due in 2023 -- based on the 2022 end-of-year balance.

That is the only way this idea could make sense.

And another thing that we retirees need to be clear on:

Sure they act like they want to keep us retired voters happy -- but -- anyone who is thinking through what some of them would really like to do to us knows that highly publicized "promise" (executive order) to "improve and protect Medicare" was a Trojan Horse.

It was a Trojan Horse because........

The plots to privatize Medicare and also Social Security have been in the works for a long time, so claiming to protect them all depends on what that "protection" is.

Our personal lives are affected every day by who we decide to give power over us. We have to be careful to look beyond the surface to what we could be giving up if privatization is railroaded through. That could happen in the next few years, so be careful what you wish for. Lobbyists have deep pockets and some in power are for sale.

Many people are caught up now in emotional responses that are being so effectively stoked by power-grabbers. But hidden in all that in-our-faces surface stuff -- private healthcare company wolves are drooling at the door.

Cassanda Boomer

PS: Besides, how likely is it that cutting us loose by privatizing Medicare and SS would actually save the government money. They would just think they had more to spend. We who are socially liberal and fiscally conservative get more concerned every day.

[retiredguy123]

Even if you have already withdrawn your RMD for 2022, you don't file your tax return until April 15, 2023. So, it is possible that you could redeposit the RMD money back into your IRA before you file your 2022 tax return.

[bp243]

Even if you have already withdrawn your RMD for 2022, you don't file your tax return until April 15, 2023. So, it is possible that you could redeposit the RMD money back into your IRA before you file your 2022 tax return.

Now that's an interesting idea. Since the market is worth less today, that money could be reinvested and hopefully gain a greater return if the market continues to grow as it has been. Do you know if this bill has been finalized or is it still being considered?

[retiredguy123]

Now that's an interesting idea. Since the market is worth less today, that money could be reinvested and hopefully gain a greater return if the market continues to grow as it has been. Do you know if this bill has been finalized or is it still being considered?
It is still being worked on. But, I assume that, if it applies to the 2022 RMD, you will be able to redeposit money that you have already withdrawn to take advantage of the law.

[Fltpkr]

HR 8331 would waive required minimum distributions for the 2022 tax year. That’s a nice way of saying Uncle Sam would not force older folks to withdraw more money than necessary from their retirement accounts this year. :thumbup:

Contact your state Representative.
Daniel Webster in Marion County

This thread seems to have been diverted into a budget debate, but returning to the original post, whether to take advantage of this gets a bit complicated and tedious (at least for my brain).

If the bill is passed, and if it applies to those who are already taking RMDs and if it allows 2022 amounts already taken to be rolled back into the tax deferred account, wouldn’t one need to consider where the money will come from to pay back the amount of RMD already taken? E.g., If you have to sell investments from taxable investment accounts to come up with the rollover cash you need (assuming you don’t have that much cash sitting around), you will be selling into a very down market to pay back RMD amounts perhaps taken in a higher market - maybe a much higher market. Also, if the investments you sell still have gains, you will be paying federal gain tax on those gains.

The benefit is that you won’t have to pay ordinary income tax on your RMD in 2022, and the roll over money that you pay back presumably will be going back into the tax-deferred account in a down market, so you are buying more stock with the rollover money. So, I think, the sale and purchase in the current down market may wash out, and you would need to weigh the gain tax now paid on the taxable sale against the ordinary income tax on the RMD saved in 2022. However, that ordinary income tax will eventually have to be paid in a future year and maybe at a higher tax rate. I would need to think thru this very carefully to see what the benefit would be. This is all probably too detailed, sorry about that.

[retiredguy123]

This thread seems to have been diverted into a budget debate, but returning to the original post, whether to take advantage of this gets a bit complicated and tedious (at least for my brain).

If the bill is passed, and if it applies to those who are already taking RMDs and if it allows 2022 amounts already taken to be rolled back into the tax deferred account, wouldn’t one need to consider where the money will come from to pay back the amount of RMD already taken? E.g., If you have to sell investments from taxable investment accounts to come up with the rollover cash you need (assuming you don’t have that much cash sitting around), you will be selling into a very down market to pay back RMD amounts perhaps taken in a higher market - maybe a much higher market. Also, if the investments you sell still have gains, you will be paying federal gain tax on those gains.

The benefit is that you won’t have to pay ordinary income tax on your RMD in 2022, and the roll over money that you pay back presumably will be going back into the tax-deferred account in a down market, so you are buying more stock with the rollover money. So, I think, the sale and purchase in the current down market may wash out, and you would need to weigh the gain tax now paid on the taxable sale against the ordinary income tax on the RMD saved in 2022. However, that ordinary income tax will eventually have to be paid in a future year and maybe at a higher tax rate. I would need to think thru this very carefully to see what the benefit would be. This is all probably too detailed, sorry about that.
If you withdrew money from an IRA this year, bought stock, and then sold it a few months later, I don't think you will be having much of a gain. But, if you do, that would be a taxable gain, since it wasn't inside of your IRA when you bought and sold it.

[Boomer]

If this happens, it seems like it would work better, with a lot less hassle, if the waiving of the RMD could be for what would need to be paid next year based on 2022. That would allow people to plan better.

Someone mentioned about the possibility of having to sell stock to pay the RMD if you do not have the cash available inside the IRA.

That can be avoided by letting cash accumulate inside the IRA, like from capturing a really good gain with a sell when the time is right and letting the profit sit there in cash for a while — or by not reinvesting dividends so they can pile up in cash and create a moat around stocks you do not want to sell at the time - - or maybe never sell.

It can feel kind of painful to see cash in an IRA not getting any return, but you can get used to it if you think of it as a moat around your stock and also as sideline money if you see an opportunity to buy when a good stock is getting pounded through no fault of its own. And if you decide to use that cash to buy a bargain, don’t use it all. Leave enough in the moat to pay the RMD.

Btw, if you do decide to buy a stock that looks like a bargain, I have a perfect piece of advice for you: Always buy it the day after I do and I can pretty much guarantee it will go down more on that day.

Anyway, never let yourself get into the position of having to sell stock to pay taxes. Build that moat.

Boomer

[retiredguy123]

I never purchased stocks in an IRA. I always had a balanced portfolio of stocks and bonds, with bonds inside the IRA and stocks outside of the IRA. That is because bonds generate interest income that is always taxed at your ordinary income tax rate, but stocks generate capital gains income that is taxed at a lower capital gains rate, but only if it is outside of an IRA. So, you get a better overall tax advantage by keeping the stock investments outside of the IRA. That assumes that you have enough investment assets to maintain an IRA and a non-IRA investment portfolio.

[Boomer]

I never purchased stocks in an IRA. I always had a balanced portfolio of stocks and bonds, with bonds inside the IRA and stocks outside of the IRA. That is because bonds generate interest income that is always taxed at your ordinary income tax rate, but stocks generate capital gains income that is taxed at a lower capital gains rate, but only if it is outside of an IRA. So, you get a better overall tax advantage by keeping the stock investments outside of the IRA. That assumes that you have enough investment assets to maintain an IRA and a non-IRA investment portfolio.


You give good advice. I just have not been into bonds for a long time — since not long after rolling over the tax deferred mutual funds from the employed days into self-directed IRAs……..

I have been interested in stocks for a long time, but never really dug into bonds much.

I used to use bond mutual funds. Probably should sometime again.

Boomer

[notme6w]

HR 8331 would waive required minimum distributions for the 2022 tax year. That’s a nice way of saying Uncle Sam would not force older folks to withdraw more money than necessary from their retirement accounts this year. :thumbup:

Contact your state Representative.
Daniel Webster in Marion County

That would be nice this year with the numbers down

[kkingston57]

What about the people who voted for them? Don't they share some of the blame?

What politician has ever said that they would create term limits when they ran for office? There are a few. Many of the career politicians have made much more than they normally would have made if they had not been in politics. In addition they have to have a majority that agree with them.

Only way that this is going to occur is if there is a ballot iniatiative like the we have in certain states. These are not always made into law or changed by the legistlators. In 1992 FLorida voted for a bullet train(at government expense) and has anyone seen one in Florida.