Larry Light: For those that don’t need the income, are there ways to lower the tax hit of an RMD?

Stephen Nelson: The IRS mandates that RMDs are to start once someone turns 70.5. This will affect all taxpayers who own IRA accounts or who have 401(k) and are no longer working. These distributions will get taxed at ordinary income rates, instead of the more favorable capital gains rates that typically happen whenever you sell a security for a gain.

Remember all those hard-working years when you got a tax deduction for contributing to retirement? Well, the IRS has said, “enough,” and is making you pay the taxes you owe by forcing you to take distributions each year.

But there are a few things that Americans can do to fight back and lower their tax bite.

Light: What can you tell me about these strategies?

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