By Harry Prabandham · Updated September 27, 2026
Retirement Planning
Required Minimum Distributions: Ages, Math, and Planning Options
RMDs are annual taxable withdrawals from pre-tax retirement accounts, starting at age 73, or 75 for those born in 1960 or later.
Required Minimum Distributions: Ages, Math, and Planning Options
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What is a required minimum distribution?
- An RMD is the minimum amount the IRS requires you to withdraw each year from pre-tax retirement accounts once you reach RMD age.
- It applies to traditional, SEP, and SIMPLE IRAs and to 401(k), 403(b), and most 457(b) plans; withdrawals are taxed as ordinary income.
- Roth IRAs have no RMDs for the original owner, and since 2024 neither do Roth accounts inside employer plans.
- Each year's amount equals the prior December 31 balance divided by an IRS life expectancy factor.
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What is a required minimum distribution?
- An RMD is the minimum amount the IRS requires you to withdraw each year from pre-tax retirement accounts once you reach RMD age.
- It applies to traditional, SEP, and SIMPLE IRAs and to 401(k), 403(b), and most 457(b) plans; withdrawals are taxed as ordinary income.
- Roth IRAs have no RMDs for the original owner, and since 2024 neither do Roth accounts inside employer plans.
- Each year's amount equals the prior December 31 balance divided by an IRS life expectancy factor.
When do RMDs start?
- People born from 1951 through 1959 start at age 73; people born in 1960 or later start at 75.
- The first RMD can wait until April 1 of the following year, but then two RMDs land in the same tax year.
- Later RMDs are due by December 31 each year.
- If you still work and don't own more than 5% of the employer, that employer's plan can usually delay RMDs until retirement; IRAs can't.
How is the amount calculated?
- Most owners use the Uniform Lifetime Table; at age 73 the divisor is 26.5, so the RMD is about 3.8% of the prior year-end balance.
- If a spouse more than ten years younger is the sole beneficiary, the Joint Life table gives a smaller required amount.
- RMDs from several IRAs can be totaled and taken from any of them, and 403(b)s can be combined with each other.
- Each 401(k) must satisfy its own RMD, and inherited accounts are calculated separately from your own.
What if an RMD is missed?
- The shortfall faces a 25% excise tax, reduced to 10% if it is corrected within the correction window, generally about two years.
- The penalty is reported on Form 5329, where you can also request a waiver for reasonable error with steps taken to fix it.
- Withholding federal tax from an RMD counts as paid evenly through the year, which can replace estimated tax payments.
- Custodians calculate RMDs for their own accounts, but responsibility for the total stays with the owner.
Rules for inherited accounts
- Most non-spouse beneficiaries must empty an inherited account within ten years of the owner's death.
- If the owner had already started RMDs, those beneficiaries also take annual RMDs in years one through nine, enforced starting in 2025.
- Surviving spouses, minor children of the owner, disabled or chronically ill people, and beneficiaries within ten years of the owner's age have more flexible options.
- A surviving spouse can roll the account into their own IRA or keep it as an inherited account, which can matter if they are younger than 59½.
How can people reduce future RMDs?
- Roth conversions in lower-income years, such as between leaving a tech job and claiming Social Security, shift tax earlier at known rates.
- Conversions raise income for Medicare premium surcharges, which look back two years, so the timing matters.
- From age 70½, qualified charitable distributions of up to $111,000 in 2026 go straight to charity, count toward RMDs, and stay out of taxable income.
- A qualifying longevity annuity contract can defer part of an IRA balance, within a dollar limit, until as late as age 85.
Key takeaways
- RMD age is 73 or 75 depending on birth year, and the first-year April 1 delay can double up income.
- The penalty for a missed RMD is lower than it used to be, especially when corrected promptly.
- Years before RMDs begin are often the main window for Roth conversions and bracket management.
- RMD rules interact with your full tax picture; confirm with a CPA, since Rubric does not prepare tax returns and this is general education.
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