Question: Two years ago when I reached age 69 1/2, I rolled my $1 million IRA into the 401(k) plan at Big Co. where I then worked. Since I'm less than a 5% owner of Big Co., I knew this would mean I would not have to take a required minimum distribution from this plan as long as I was still working for the company. Last year I turned 70 1/2 and my scheme worked like a charm: No RMD is required from the Big Co. 401(k) plan until the "later of" the year I turn 70 1/2 or the year I retire--so there was no RMD in 2017.
Now it's 2018 and I retired in July (at age 71). I asked the 401(k) plan to transfer my entire 401(k) balance by "direct rollover" into my IRA. The plan administrator wouldn't do it unless it first paid me the entire 2018 RMD in cash. The plan administrator said that after I took out the fully taxable 2018 RMD, it would direct-roll the remainder of my 401(k) account into my IRA.