Required minimum distributions: RMD rules explained

A required minimum distribution (RMD) is the smallest amount the IRS requires you to withdraw each year from certain tax-deferred retirement accounts once you reach a set age. It exists because the government eventually wants the taxes it let you defer — RMDs turn a tax-deferred account into taxable income, one withdrawal at a time.

Which accounts have RMDs — and which don't

Whether an account has RMDs depends on its tax treatment, not just its name.

RMDs required during the owner's life:

• Traditional IRAs, including rollover IRAs
• SEP and SIMPLE IRAs
• Traditional 401(k)s
• 403(b) and 457(b) plans

No RMDs during the owner's life:

• Roth IRAs — never have, at any age
• Roth 401(k)s and other designated Roth accounts in employer plans — no lifetime RMDs starting in 2024, a SECURE 2.0 change (IRS)

That difference is big: money in a Roth can keep growing untouched for the original owner's whole life, while a traditional account has to start paying out — and generating taxable income — whether the money is needed or not.

When do RMDs start?

The age isn't one fixed number anymore. The SECURE Act (2019) and SECURE 2.0 Act (2022) pushed it back in stages:

Born	RMDs begin at age
Before July 1, 1949	70½
July 1, 1949 – 1950	72
1951 – 1959	73
1960 or later	75

This reflects law as of 2026. Congress has changed the age twice since 2019, with a third step already scheduled, so confirming the current rule on IRS.gov before acting on it is worthwhile.

How an RMD is calculated

The formula is simple; the two inputs are the only moving parts:

RMD = prior December 31 account balance ÷ life-expectancy factor

• The balance is the account's value on December 31 of the previous year.
• The factor comes from an IRS table. Most owners use the Uniform Lifetime Table. A different table, with smaller RMDs, applies when a spouse more than 10 years younger is the sole beneficiary.

Uniform Lifetime Table factors (IRS Publication 590-B):

Age	Factor	RMD as % of balance
73	26.5	3.8%
75	24.6	4.1%
80	20.2	5.0%

Illustrative example

A 75-year-old with a $500,000 traditional IRA balance on December 31 of the prior year:

• RMD = $500,000 ÷ 24.6 ≈ $20,325

That $20,325 is added to taxable income for the year. Because the factor shrinks every year, the required percentage keeps rising — which is why RMDs can grow even while the account shrinks.

The first-year deadline — and the two-RMDs trap

The first RMD comes with a special option and a common pitfall.

• Delay option: the first RMD can wait until April 1 of the year after you reach RMD age. Every later RMD is due by December 31.
• The trap: delaying the first one means the second is due that same December 31 — two taxable RMDs in one calendar year.
• Doubling up can push income into a higher bracket, make more Social Security benefits taxable, and raise Medicare premiums through IRMAA surcharges two years later.

For that reason, many planners suggest weighing the tax hit before using the April 1 delay, even though it's allowed.

Rules people trip over

• RMDs can't be rolled over. Money that satisfies an RMD can't go into another IRA or plan (IRS).
• The first dollars out count toward the RMD. In an RMD year, a withdrawal meant to be rolled over is treated as the RMD first, until the RMD is met.
• Withdrawals don't have to be cash. An RMD can be taken "in kind" — shares moved to a taxable account — and still count, valued on the date of transfer.
• Taking more than required doesn't carry forward. An extra withdrawal this year doesn't reduce next year's RMD.

Aggregating IRAs vs. 401(k)s

Mixing this up is one of the most common RMD mistakes. Per the IRS:

• IRAs (traditional, SEP, SIMPLE): calculate each account's RMD separately, then withdraw the total from any one or more of them.
• 403(b)s: same idea — calculate separately, then take the total from any of your 403(b) contracts.
• 401(k)s and 457(b)s: each plan's RMD must come out of that plan.
• No mixing across types or people. An IRA's RMD can't be satisfied from a 403(b), and spouses can't combine each other's accounts.

The still-working exception

Some people can delay RMDs from a current employer's plan.

• If you're still working for the company that sponsors your 401(k) or 403(b), RMDs from that plan can generally wait until the year you retire (IRS).
• It does not apply to 5% owners of the business.
• It does not apply to IRAs or to plans from former employers.
• Not every plan offers it — it depends on the plan document.

What happens if an RMD is missed

• A 25% excise tax applies to the amount that should have come out but didn't (IRS).
• It drops to 10% if the shortfall is withdrawn and corrected within two years.
• The fix is filed on Form 5329, where the IRS also allows a request to waive the tax for reasonable error if the missed amount has been taken.

SECURE 2.0 cut this from the old 50% penalty, so older summaries overstate it.

Planning ideas people discuss around RMDs

These are strategies commonly discussed in retirement planning, not recommendations for any individual. A CPA or financial professional can weigh them against a specific set of accounts and goals.

• Qualified charitable distributions (QCDs): a qualified charitable distribution sends IRA money straight to a charity and can count toward the RMD without adding to taxable income. Two details many people miss: QCDs start at age 70½ — years before RMDs do — and they're allowed from IRAs only, not 401(k)s. The 2026 limit is $111,000 per person (IRS, indexed for inflation).
• Roth conversions before RMDs start: converting part of a traditional account in the years between retirement and RMD age means paying tax now in exchange for smaller future RMDs. Whether it pays off depends on current versus expected future tax brackets.
• Withdrawal order: the order of drawing from taxable, tax-deferred, and Roth accounts affects lifetime taxes and how RMDs stack with Social Security, which is why some retirees map it out years in advance.

A quick word on inherited accounts

Inherited-account rules are their own system, and they changed a lot under the SECURE Act.

• Most non-spouse heirs (like adult children) must empty an inherited IRA or 401(k) by the end of the 10th year after the owner's death.
• If the original owner had already started RMDs, the heir generally also has to take annual withdrawals in years 1–9, under final IRS regulations issued in 2024.
• Spouses, minor children, disabled or chronically ill heirs, and heirs close in age to the owner get more flexible options.

Because the details turn on who inherited and when the owner died, inherited accounts are worth working through with IRS guidance or a tax professional.

RMDs are one of the few retirement milestones with a hard deadline, which makes them worth planning for years before they start — not just the year they kick in.