Required Minimum Distribution Method

See: Required Minimum Distribution.

Okay, so this adds "method" to the madness (of the IRS). Revisit the tables. Notice how, in the early years of retirement, only 1/24 or so is required to be distributed from the RMD. Why only about 4%? Well, life expectancy. (See: Actuarial Method). At 75-ish, people today are expected to live many more years. So the IRS doesn't want these people to distribute all of their money in Year 1, go party down for 3 years, spend and lose it all, and then blammo...the geezers are living in station wagons down by the river.

To avoid this calamity, the IRS "gates" the amount that can be distributed into a kind of asymptote, such that it never reaches zero. Even at 96, not all of the IRA can be distributed.

So...that's the method. And yeah, we know all 'bout the madness.