Here's just what you need: another complication involving individual retirement accounts.

Plenty of attention has been given to the problems of investing in IRAs (and 401(k)s, which is where a lot of the assets in IRAs originate), and about figuring out how much money you have to take out each year after you turn 701/2 to comply with the law.

But there's also the question of exactly when is the best time to make those required withdrawals. You have to make them each year, but a year can be a long time, particularly in stock-market time, so whether you take the withdrawal at the first of the year or the last can make a difference.

The Internal Revenue Service has in recent years greatly simplified the rules for calculating these withdrawals, called required minimum distributions (RMDs). After the year in which you turn 701/2, for which there are special rules, figuring the amount is fairly straightforward. Basically, you take the value of your IRA (or all your IRAs together, if you have more than one) on Dec. 31 and divide by a life expectancy figure, which you get from an IRS table. The result is the amount you have to take out. (The IRS publishes life expectancy tables, along with lots of other information about IRAs, in Publication 590, "Individual Retirement Arrangements." It's available on the IRS's Web site,

Thus, a single person who had $100,000 in one or more IRAs on Dec. 31, 2003, and who turns 75 this year would use a life expectancy figure of 22.9, which would dictate an RMD of $4,367 ($100,000 divided by 22.9). You can take more, of course, but there's a penalty for taking less.

The distribution becomes part of that year's taxable income.

But you have all year to make the actual withdrawal. If your account is mostly in stocks and the market is going up, it would be advantageous to wait, allowing the shares to rise before you cash them in. On the other hand, if the market is falling, it's to your advantage to take distribution right away, selling shares before they lose value.

"Since the market is more often up than down, generally speaking, taking the required minimum distribution at the end of year is going to be better than taking it at the beginning," said Stuart Ritter, a financial planner with T. Rowe Price, the big Baltimore mutual fund operator.

That reflects "the fundamental principle that you want to allow your tax-deferred assets to grow as long as possible," he said. By taking the RMD at year-end, "you give your assets an extra year to grow."

But, of course, the market doesn't always go up, and when that is the case, as it was a couple of years ago, early withdrawals were better.

To see what that means in real life, T. Rowe Price, at The Post's request, took two hypothetical IRA account holders who turned 72 in 1994. Each had a $100,000 IRA at that time, and each had the account invested in the Standard & Poor's 500-stock index. However, one IRA holder took his distribution on Jan. 1 each year, and the other took it on Dec. 31.

The effects can be seen in the accompanying chart.

As the market soared in the mid- and late-1990s, the late withdrawer moved ahead smartly, reaching a peak of more than $285,000 in 1999, some $12,000 ahead of the early withdrawer. But much of that lead evaporated when the market plunged, leaving the late withdrawer up by less than $3,000 at the end of last year.

Of course, as the market turned, a real account holder might have changed strategies. T. Rowe Price calculated what would have happened if the late withdrawer had sensed the market slump coming and switched to early withdrawal in the down years and back again last year -- in effect timing the market perfectly.

That would have helped. His balance at the end of last year would have been $187,278, compared with the $179,350 he got by sticking to his strategy.

On the other hand, they say the little guy is always wrong about the markets, so suppose one of our account holders completely mistimed the market, taking early withdrawals when things were booming, then decided to switch just when the market sank. This guy would have ended up with $170,412.

These differences aren't large, but over a retirement that could go on for 20 or 25 years, given today's life expectancies, they could become significant. And since the life expectancy number gets smaller as you get older, you have to take out a larger and larger share of what's left of your account with each succeeding year.

Also, many retirees will be taking more than the minimum for living expenses, so don't be beguiled by the fact that in all cases the account was larger at the end of 10 years than at the beginning. These accounts were buoyed by six years, including five straight (1995-99), of market returns of over 20 percent. It could take a long time before we see another decade like that.

For IRA holders who don't want to try to time the market, "it makes sense to play the odds" and withdraw late, Ritter said, since the odds are 70-30 that the market will be up in any given year.

But the figures also illustrate the benefit of holding a diversified portfolio. Having some bonds, which often move in the opposite direction from stocks, can smooth out the bumps.

Long Island CPA Ed Slott, who specializes in IRAs, recommends having cash in the account equal to a year or two's worth of RMDs so that, if necessary, you can pull that out as the RMD rather than, for example, sell stocks when the market is down.

But Slott also noted that if you have the money to pay the taxes, you don't actually have to sell IRA assets to meet the RMD requirements. You can take an "in-kind" distribution, allowing you to move shares from the IRA to a taxable account. The value of the shares is the amount on which you have to pay tax, but if they rise in value, those later gains are taxable at favorable capital gains rates when you finally do sell.

And finally, these complexities are one of the appeals of the Roth IRA. Roths are funded with after-tax dollars, and there are no taxes on RMDs. In fact, there are no RMDs. You can just leave it in there as long as you like.

Pondering the imponderable: At the U.S. Tax Court, questions often arise that might charitably be defined as arcane. But occasionally they border on the metaphysical. Take, for instance, this one: Is a motor home "used predominantly to furnish lodging" or "used primarily as a means of transportation"?

The question is not without consequence. A deduction taken by a taxpayer would be allowable if a motor home is transportation and not allowable if it is lodging. An Oregon couple, in the business of selling and renting these vehicles, said "transportation" and took an accelerated deduction for a motor home they bought and rented out on a short-term basis, calling it business equipment. The IRS called it "lodging" and disallowed the fast write-off.

The case, opined Judge Mark V. Holmes, "asks an imponderable question -- when a vehicle can be simultaneously used for both lodging and transportation, how can one tell which is primary?"

His answer: Well, since most of the rentals were for fewer than 30 days, it appeared in this case that the motor home was used more for transportation than lodging, so the taxpayers could take the accelerated deduction. But as for stating a general principle, the judge said, "we leave grappling with a difficult element of a difficult test for another case." And in case you're wondering, there's plenty of precedent for that. In a footnote, the judge pointed to two other cases, one "avoiding decision on whether mobile homes were 'tangible personal property' " and the other "avoiding decision on whether mobile homes qualified as hotel or motel."