New IRS Life Expectancy Tables Mean Lower RMDs in 2022

How the Tables Will Change RMDs

There are three tables. One is for singles. The second, the uniform lifetime table, applies for lifetime distributions to an employee in situations in which the employee's surviving spouse is not the sole designated beneficiary. This table is also used if the employee's surviving spouse is the sole designated beneficiary but is not more than 10 years younger than the employee. The third, the joint and last survivor table, is used for determining the joint and last survivor life expectancy of two individuals. Mortality rates are also provided.

Choate provides several examples of how the new tables will change RMDs. For instance, if Glenda is turning 77 in 2022, going through the process to determine her RMD on a $1 million IRA, and assuming her designated beneficiary is not her spouse who is 10 years younger, she would divide the applicable factor from the uniform lifetime table, which is 22.9. Thus, her 2022 RMD is $43,668.12. The old tables had her RMD at $47,169.81. Her reduction: $3,500.

Choate does note that the increase in life expectancy has a certain amount of "irony" —"These new tables, designed to reflect longer life expectancies, come just as America experiences a downtick in life expectancies due to the coronavirus and its reverberations."

But that factor may not play out in new tables soon. These IRS tables are not updated often, and in fact, the Treasury Department and the IRS asked for feedback on how often they should be updated and they "currently anticipate that they will review the tables at the earlier of: (1) 10 years or (2) whenever a new study of individual annuity mortality experience is published," according to the IRS bulletin.