How will I know how much I have to take out? Who calculates my distribution?
TRS will send you a letter each year with the information you need. The calculation will be made according to IRS regulations, using appropriate account information, as well as your age and life expectancy according to IRS age tables.
How is my minimum distribution calculated?
For members under age 75, the distribution is calculated by taking the sum of deposits and earnings on your TSA account after 1986, less any minimum distributions required in prior years, divided by your life expectancy. Beginning the year you reach 75, the minimum distribution is calculated by dividing your account balance as of January 1 by your life expectancy. Life expectancy tables are provided by the IRS.
Will my distribution amount be the same every year?
No. In general, the required amount will increase each year.
What if I find I need more than my required minimum distribution?
No problem. You may always receive more than the required amount (but you can never receive less).
Do I have to pay taxes on this money?
Yes. The entire distribution is taxable income, however TRS is not required to withhold taxes on your behalf. (Note: TRS is required to withhold taxes on any amount in excess of your minimum distribution.)
What if I want TRS to withhold taxes for me?
When you receive your letter each year, simply indicate what amount of tax you want withheld and return. TRS will send you a 1099 to use for filing your taxes.
When will I get my check?
You choose the time. Indicate your preference on your minimum distribution letter and return to TRS. TRS will issue the check at the appropriate time.
What if I forget to return the letter that lets TRS know when I want the money and the amount of taxes I want withheld?
If TRS does not receive any instructions from you, it will issue the check in early December with no taxes withheld. However, the preference is for you to return the form so you can indicate withholding choices.
My distribution is rather large. Do I have to take it out all at one time?
No. You may take several distributions, or take a single lump-sum distribution. It's up to you.
Where can I get more information on minimum distributions?
Refer to IRS publications 571 and 575.
