If a participant in a DC plan turns 70 1/2 in December of 2002, it was my understanding that age 70 should be used to calculate the first RMD regardless of whether the distribution occurred in 2002 or by April 1, 2003. Someone has told me that if the first distribution occurs in 2003 it should be based on the age the particpant turns in 2003, in this case 71. I don't think that is correct, but couldn't find anything definite in the regs for either case. Any help would be appreciated.

Prop. Reg. 1.401(a)(9)-5, Q4 says you use the distribution period based on "the employee's age as of the employee's birthday in the relevant distribution calendar year." Since the first distribution in this case will be for the 2002 distribution year, you would use the employee's age on their birthday this year.

Hope this helps.