The 'Take annuity RMD from IRA accounts first' setting can be found within the Gear Icon > Settings > Methodology tab of each client plan:
This setting, if checked, allows you to delay taking withdrawals from qualified annuities with a lifetime income guarantee (set up with a distribution type of 'Lifetime Income') by satisfying the annuity's Required Minimum Distributions (RMD) from the client's traditional IRA accounts or other qualified annuities. This allows clients to delay withdrawals on the lifetime income annuity to provide a higher guaranteed income amount in future cash flows.
If the setting is unchecked, we will calculate the RMD for lifetime income annuities each year starting in the year the client turns 73 and will distribute the greater of the RMD or the client's lifetime income amount in that year.
Also, if this setting is checked, once the client has started taking lifetime income withdrawals, if the client's RMD exceeds the lifetime income amount, we will take the excess from the client's IRA or other qualified annuities.
Only use this setting if your client has sufficient funds in their IRA or other qualified annuity to cover the additional RMDs. If there is insufficient funds in their IRA or qualified annuity to cover the additional RMDs, the client's RMDs will be understated as we will not take the balance from the annuity.
Whether the setting is checked or not, once lifetime income withdrawals begin, those withdrawals will count towards the total RMD required across your clients' IRA and qualified annuity accounts. If the lifetime income amount exceeds the RMD calculated for the lifetime annuity, we will reduce the RMD from the client's traditional IRA by the excess amount.
