Tax Rule Slams Hard-Hit IRAs, 401(k)s

By TOM LAURICELLA, Wall Street Journal (subscription required) In the past month, Congress and the Bush administration have worked feverishly to help Wall Street. Now millions of older adults are seeking last-minute help with a problem that directly affects Main Street: required withdrawals from retirement accounts. Individual taxpayers, lobbying groups and even some politicians are pressing Washington to change the rules regarding "required minimum distributions" (RMDs) from individual retirement accounts, 401(k)s and related savings vehicles. Two weeks ago, AARP, the large membership group for older adults, asked the Treasury Department to give IRA holders the option of not taking a required distribution this year. It's an idea backed by President-elect Barack Obama. The problem, says David Certner, AARP's legislative-policy director, is that time is running out. Typically, distributions must be taken by Dec. 31, and many account holders wait until November or December to withdraw the needed funds.