It's hard to keep up with all the legislative changes undertaken as the federal government grapples with the recession.

So, on occasion, I'll be writing about the new laws affecting your pocketbook. You may already have heard about the changes but, hey, it can't hurt to confirm what you know or think you know.

One change that President Bush signed just before Christmas affects a lot of seniors.

Speir Collins, an 86-year-old reader from Nokomis, Fla., asks: "Have you written about the new law that says retirees do not have to take mandatory withdrawals from their IRA accounts during 2009? If not, I think it would be doing old folks like me a great service to bring this information to their attention."

Collins is right. Many people may not have heard about this since the law was passed over the holidays. Tucked in the Worker, Retiree and Employer Recovery Act of 2008 signed by Bush on Dec. 23 was a provision that waives any required minimum distributions in 2009 from retirement plans such as 401(k)s, 403(b)s and certain 457(b)s. The distribution rules also apply to traditional IRAs and IRA-based plans such as Simple IRAs and SEPs (simplified employee pension plans), which provide employers with an easy method to make contributions toward their employees' retirement or, if self-employed, their own retirement.

If you have such a plan, you probably know, or should know, that the government demands you withdraw a portion of your money even if you don't need it. The first required minimum distribution payment can be delayed until the following April 1 of the year in which you turn 701/2. For all subsequent years, including the year in which the first required distribution was paid, you must take a distribution by Dec. 31.

For many people, the recent rule change is a year too late. With the dive in the stock market last year, many seniors needed this relief for 2008. The problem is the amount seniors have to withdraw is based on their balances from the previous year. In most cases, their investments have suffered losses since 2007, which means they had to withdraw funds at a low in the market.

Generally, the required distribution that seniors have to take is calculated for each account by dividing the prior Dec. 31 balance of the person's IRA or retirement plan account by a life expectancy factor that the IRS lists in the tables of Publication 590 — "Individual Retirement Arrangements (IRAs)."

You have to get this right because if you fail to take out the required minimum distribution, you face a huge penalty. The amount not withdrawn is taxed at 50 percent. The penalty may be waived if you can successfully argue to the IRS that the shortfall in your distributions was due to a reasonable error and that you took steps to remedy the shortfall.

Still confused about this rule change? It would not be surprising. Either get professional help or call the IRS at 800-829-1040 to make sure you are taking the right distribution.