Here are some common retirement-account-related acronyms:
IRA:
Individual retirement arrangement. (Not “account!”)
RMD:
Required minimum distribution. The minimum amount that must be withdrawn from a retirement account each year after reaching a certain age.
RBD:
Required beginning date (for starting RMDs). Generally, on April 1 of the year after the year a person turns 73.
QLAC:
Qualifying longevity annuity contract. An annuity whose value (up to $200,000) can be excluded from an IRA owner’s balance for RMD calculation purposes.
EDB:
Eligible designated beneficiary. Category of beneficiary who may take stretch RMDs.
NEDB:
Non-eligible designated beneficiary. Category of beneficiary who gets the 10-year rule.
NDB:
Non-designated beneficiary. Category of beneficiary that includes “non-people,” like an estate or charity. Payout rules applicable to NEDBs are the 5-year rule or “ghost rule.”
ALAR:
At least as rapidly. The rule dictates that when RMDs have begun, they must be continued by the beneficiary. ALAR is a function of frequency, not amount.
QCD:
Qualified charitable distribution. A distribution from an IRA to a qualified charity, subject to an age requirement of 70 ½ or older.
CWA:
Contemporaneous written acknowledgement. This is just a receipt for your QCD!
CGA:
Charitable gift annuity. A one-time QCD of $53,000 (for 2024) can go to an entity like a CGA, CRAT (charitable remainder annuity trust), or CRUT (charitable remainder unitrust).
DAF:
Donor-advised fund. A QCD cannot be made to a DAF.
NUA:
Net unrealized appreciation. Tax strategy used to pay long term capital gains on the appreciation of company stock. (Be sure to know all the NUA rules before proceeding.)
NIA:
Net income attributable. The gain or loss on an excess IRA contribution.
QDRO:
Qualified domestic relations order. Used to split a retirement plan after divorce.
SECURE Act:
Setting Every Community Up for Retirement Enhancement Act.
By Andy Ives, CFP®, AIF®
IRA Analyst
