Excess Accumulation Penalty

AAA

DEFINITION of 'Excess Accumulation Penalty'

The penalty a retirement account owner or the beneficiary of a retirement account must pay when he or she fails to distribute a minimum amount due for a year from the retirement account.

INVESTOPEDIA EXPLAINS 'Excess Accumulation Penalty'

The failure to distribute this amount will result in the individual being subject to an excess accumulation penalty of 50 percent of the amount not distributed from the account. This amount is then owed to the IRS.

RELATED TERMS
  1. 401(k) Plan

    A qualified plan established by employers to which eligible employees ...
  2. Individual Retirement Account - ...

    An investing tool used by individuals to earn and earmark funds ...
  3. Internal Revenue Service - IRS

    A United States government agency that is responsible for the ...
  4. Pension Plan

    A type of retirement plan, usually tax exempt, wherein an employer ...
  5. Required Minimum Distribution - ...

    The amount that Traditional, SEP and SIMPLE IRA owners and qualified ...
  6. Roth IRA

    An individual retirement plan that bears many similarities to ...
Related Articles
  1. Taxes

    Preparing For Retirement Plan RMD Season

    Paying taxes is inevitable - that's why you need to learn about the rules for required minimum distributions.
  2. Retirement

    Health problems caused me to take my RMD after the deadline. Can I appeal my case to the IRS?

    When you missed your required minimum distribution (RMD), you should have sent in a letter of explanation and filed IRS Form 5329 with your tax return. If you did not do so, you will still need ...
  3. Taxes

    Tax-Saving Advice For IRA Holders

    Be informed about benefits and deductions that may apply to you and avoid costly mistakes on your return.
  4. Retirement

    Disclaiming Inherited Plan Assets

    There are some good reasons for choosing not to accept the funds, but be sure you follow the proper process.
  5. Taxes

    6 Important Retirement Plan RMD Rules

    Paying taxes is inevitable - that's why you need to learn about the rules for required minimum distributions.
  6. Savings

    5 Ways To Lose Your Retirement Nest Egg

    These common mistakes can put your savings at risk. Find out how to avoid them.
  7. Retirement

    Tough Times: Should You Dip Into Your Qualified Plan?

    401(k)s, pensions and profit-sharing plans can be a source of cash, but there are consequences to this option.
  8. Is an online adviser right for you? As with most questions in financial planning, the answer is 'it depends.' Here are a few thoughts to consider.
    Professionals

    Is An Online Financial Advisor Right For You?

    Is an online adviser right for you? As with most questions in financial planning, the answer is 'it depends.' Here are a few thoughts to consider.
  9. Something you can do for your savings and investing resolutions this year is to rely on tools already available at your workplace and take them to the max.
    Savings

    Taking Smaller And More Manageable Resolutions

    Something you can do for your savings and investing resolutions this year is to rely on tools already available at your workplace and take them to the max.
  10. Should you delay taking your Social Security benefits? As with most things in the financial planning world the answer is: 'it depends.'
    Professionals

    Social Security: To Delay Or Not To Delay?

    Should you delay taking your Social Security benefits? As with most things in the financial planning world the answer is: 'it depends.'

You May Also Like

Hot Definitions
  1. Christmas Island Dollar

    The former currency of Christmas Island, an Australian island in the Indian Ocean that was discovered on December 25, 1643. ...
  2. Santa Claus Rally

    A surge in the price of stocks that often occurs in the week between Christmas and New Year's Day. There are numerous explanations ...
  3. Commodity

    1. A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often ...
  4. Deferred Revenue

    Advance payments or unearned revenue, recorded on the recipient's balance sheet as a liability, until the services have been ...
  5. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at least one country other than its home country. Such companies ...
  6. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
Trading Center