Refusing to give up the battle over granting the same relief from required minimum distribution (RMD) rules in 2008 that has been granted for 2009, a 61-member U.S. House coalition has called on President George W. Bush to order the U.S. Treasury Department to give investors the 2008 relief.
The letter by the group, led by Representatives Spencer Bachus (R-Alabama) and Rodney Frelinghuysen (R-New Jersey), demands that Bush order the Treasury Department to reverse its decision not to extend the RMD relief to 2008 (see “RMDs Still Required in 2008“) and to allow those already forced to take a distribution to recontribute it “in order to give their savings time to recover from the down market.”
“While the Internal Revenue Code requires retired individuals to begin taking withdrawals the later of the year after they retire or the year after they turn 70 세, it is our understanding that Treasury regulations set the specific intervals and penalties, and therefore the distribution requirements could be adjusted for 2008 without Congressional action,” the letter stated.
“Federal tax regulations should not force seniors to take money from their retirement accounts at a time when the value of their investments has plummeted,” Bachus said in a news release. “The bill pending before the President (signed by Bush into law earlier this week (see “Bush Signs RMD, Pension Relief into Law“) is a good step going forward, but seniors have already suffered significant losses and administrative action is needed to protect their savings this year as well.’
Frelinghuysen added: “The government should not mandate financial losses on retirees by forcing them to sell their stocks when the market is low. The President should step in and help older Americans by suspending mandatory minimum withdrawal rules for 2008.’
The letter is available here.