How to Calculate SEP and IRA Mandatory Distributions
- 1). Determine the value of all of your SEP IRAs or traditional IRAs at the end of the previous calendar year.
- 2). Determine which life expectancy table to use. If you are a beneficiary of an IRA, use table one. If you have a spouse who is more than 10 years younger than you who is your only beneficiary, use table two. Everyone else uses table three.
- 3). Determine your distribution period by using the appropriate life expectancy table found in step 2.
- 4). Divide the value of your IRA by the distribution period. For example, if your IRA is worth $500,000 and your distribution period is 16.5, you would have to withdraw $30,303.03.
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