FAQs about RMDs

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A note on SECURE Act 2.0 

The content in this article may not reflect the latest information on retirement accounts and the Required Minimum Distribution age due to a recently passed law known as SECURE Act 2.0. Learn about key provisions of this legislation and reach out to us with questions. 

Across 401(k), IRA, 403(b) and 457(b) accounts, the IRS does not allow investors to maintain balances indefinitely. As such, a minimum amount must be withdrawn each year usually beginning at age 72. This amount is a required minimum distribution, or RMD.

However, IRS rules around RMDs can be complex and result in tax penalties if not followed correctly.

As you draw closer to retirement years, we can help you avoid these penalties by helping you determine your RMD amount and creating a withdrawal strategy for these distributions (and your other retirement income) that is compliant with the law. Here are answers to commonly asked questions about RMDs:

1. When do I have to take my RMD?

While some plans allow you to delay an RMD until you retire, the simplest approach for many individuals is to take the first RMD by Dec. 31 in the year they turn age 72 and continue RMDs by Dec. 31 every year after that.

The IRS does allow an alternative approach:

  • Age 72 RMD. When you turn age 72, take one RMD by April 1 of the year following that birthday and take a second RMD by Dec. 31 of that year. For example, if you turn age 72 in July 2023, you would take your first RMD by April 1, 2024, and your second RMD by Dec. 31, 2024.
  • Age 73+ RMDs. RMD required annually by Dec. 31.


2. Is there a penalty if I don’t take my RMD?

If you do not take a distribution or if you withdraw less than the required amount, you may have to pay a penalty equal to 50% of the amount not taken. You can take more than the required amount, but the extra withdrawals don't count toward RMDs for future years.

Generally, withdrawals of pre-tax contributions and earnings are taxed as regular income. If you have after-tax money in your IRA, those distributions will still count toward your RMD but won’t be taxable.

3. How do I figure out my RMD amount?

RMDs are determined separately for each of your retirement plans and are required per individual, not per couple. To estimate the amount of your RMD, use our RMD calculator.


4. Can I combine RMDs for separate retirement plans?

If you have more than one retirement plan, you must calculate separate RMDs for each plan. However, if you have more than one IRA — whether a traditional, SEP and/or SIMPLE IRA — you can add the RMDs and take the combined distribution amount from any one or more of your IRAs.

Similarly, if you have more than one 403(b) plan, you can take the combined distribution amount from one or more of your 403(b) accounts. You cannot, however, satisfy the RMD for your IRA with a distribution from your 403(b) or vice versa.


5. Are there any RMD strategies to consider?

One potential strategy is to make a qualified charitable distribution (QCD) to an eligible 501(c)(3) organization of your choice, up to $100,000 total for one or more organization.

A QCD is a nontaxable distribution from an IRA directly to an eligible charity. It can count toward your required RMD for the year — and neither you nor the eligible charity will have to pay income taxes. Keep in mind that a QCD is reported differently on your taxes than a regular charitable contribution. Consult your tax professional if you are considering QCDs.


We can help determine your RMDs

RMD rules can be difficult to understand. We're committed to helping you determine the correct amounts for each of your investment accounts to help you avoid tax penalties. We do not, however, provide legal or tax advice.