Understanding Required Minimum Distributions (RMDs)
Once you reach age 73, federal law generally requires you to begin taking Required Minimum Distributions (RMDs) from certain retirement accounts. These withdrawals apply to traditional IRAs and many employer-sponsored retirement plans, including 401(k), 403(b), 457, SEP IRA, SIMPLE IRA, and Thrift Savings Plan accounts.
Beginning in 2024, Roth IRAs, Roth 401(k)s, and Roth 403(b)s are exempt from lifetime RMD requirements for the original account owner.
When Do RMDs Begin?
You generally must begin taking RMDs for the year you turn age 73.
Your first RMD can either:
- Be taken by December 31 of the year you turn 73, or
- Be delayed until April 1 of the following year
However, delaying your first RMD may result in taking two taxable distributions in the same calendar year.
For example, if you turn 73 during 2026, you may delay your first RMD until April 1, 2027 — but you would also need to take your second 2027 RMD by December 31, 2027.
Calculating Your RMD
Your RMD amount is calculated annually based on:
- Your retirement account balances as of December 31 of the prior year
- IRS life expectancy tables
If needed, we can help calculate your RMDs if you provide your year-end retirement account information or Form 5498 documents.
Inherited Retirement Accounts
Rules for inherited IRAs and retirement accounts can be significantly more complicated, especially following changes under the SECURE Act.
Many non-spouse beneficiaries are now generally required to fully distribute inherited retirement accounts within 10 years, though exceptions and special rules may apply depending on:
- The beneficiary’s relationship to the original account owner
- The age of the original account owner at death
- Whether RMDs had already begun
Because IRS guidance in this area continues to evolve, beneficiaries should consult a qualified tax professional to avoid unexpected penalties or distribution issues.
Need Help Navigating RMD Rules?
Required Minimum Distribution rules can be confusing, and mistakes may lead to unnecessary taxes or penalties. Gleason Tax Advisory can help you understand your options, calculate distributions, and plan strategically for retirement withdrawals.
