Key takeaways
- Required minimum distributions (RMDs) generally begin at age 73 from traditional 401(k)s, traditional IRAs, SEP IRAs and SIMPLE IRAs.
- Your first RMD is due April 1 of the year after you turn 73, and every later RMD is due December 31 of the year itself.
- Each year’s amount is the balance at the end of the previous calendar year divided by an IRS distribution period.
- Roth IRAs and Roth 401(k)s have no lifetime RMDs for the original owner, though beneficiaries who inherit them do follow RMD rules.
- Missing an RMD brings a 25% penalty on the shortfall, reduced to 10% if you correct it and file an amended return within two years.
For years, a 401(k) or traditional IRA can sit untouched while it grows. At some point, federal rules turn withdrawals from optional to required. These withdrawals, called required minimum distributions, come with firm deadlines and real penalties for missing them. The answers below cover when they start, how the amounts are figured and where the exceptions sit.
What Is a Required Minimum Distribution?
A required minimum distribution, or RMD, is the smallest yearly withdrawal the law allows you to take from certain retirement accounts, generally beginning in the year you turn 73. The rules cover traditional IRAs, SEP IRAs, SIMPLE IRAs and workplace plans such as 401(k)s, 403(b)s and 457(b) plans. They exist because these accounts are tax-deferred: you put off paying tax on contributions and earnings, and the rules do not allow that tax bill to be delayed forever.
You can always take out more than the minimum. Each withdrawal counts as taxable income except for any part you already paid tax on, called your basis, or amounts that come out tax-free, such as qualified distributions from Roth accounts.
At What Age Do RMDs Start, and Did That Age Change?
The starting age is 73 for tax years 2023 and later, and yes, it has moved. It was 70½ for tax years 2019 or earlier, then 72 for tax years 2020 through 2022, and it rises to 75 in 2033.
Timing matters as much as the age. Your first RMD covers the year you turn 73 and is due by April 1 of the following year. Every RMD after that is due by December 31 of the year itself. If you wait until April 1 for that first withdrawal, you must also take the second one by that same December 31, which puts two taxable withdrawals into one tax year.
Money tip: Delaying the first RMD to April 1 is allowed, but it stacks two withdrawals into a single tax year. The extra income can raise your tax bill and may affect Medicare premiums, so plan before you choose.
How Is the Amount You Must Withdraw Calculated?
To figure each year’s amount, take the account balance from the close of the prior calendar year and divide it by a distribution period listed in the IRS’s Uniform Lifetime Table. The distribution period is an estimate of how many years withdrawals will continue, based on life expectancy; at age 73 it is 26.5 years. A balance of $100,000 divided by 26.5 comes to about $3,774 for the year. Because both your age and your balance change annually, the amount changes too.
Other tables apply in narrower cases. Table II, the Joint Life and Last Survivor Expectancy Table, applies if your spouse is more than 10 years younger and is the sole beneficiary of the account. Table I covers beneficiaries who are not the account owner’s spouse.
You do not have to do this math alone. The IRA trustee or plan administrator must report the RMD amount to you, and many will calculate it for you or let you set up automatic withdrawals. The IRS publishes worksheets as well.
Do You Take the RMD From Each Account Separately?
It depends on the account type, because IRAs and workplace plans follow different aggregation rules. An IRA owner must calculate the RMD separately for each IRA, but can then withdraw the combined total from one or more of the IRAs. RMDs from workplace retirement plans must be taken separately from each account, with no combining. That difference is one of several between a 401(k) and an IRA.
Do Roth 401(k)s and Roth IRAs Have the Same Rules?
No. Roth IRAs and the Roth accounts offered inside 401(k) and 403(b) plans carry no withdrawal requirement while the original owner is alive. Because Roth contributions were already taxed, there is no deferred tax bill for the rules to force out.
The picture changes at inheritance. Anyone who inherits one of these accounts has to follow the required minimum distribution rules. When the original owner died after December 31, 2019, the entire balance generally must be distributed within 10 years. There are exceptions, including when the beneficiary is a spouse, a child who is still a minor, someone who is disabled or chronically ill, or someone whose age is within 10 years of the owner’s.
Choosing between Roth and pretax contributions in a workplace plan is a separate decision, made long before any of this. Roth 401(k) or Traditional 401(k): How They Compare walks through that trade-off.
What If You’re Still Working at That Age?
You may be able to delay, but only from your current employer’s plan. Participants in a workplace retirement plan can put off RMDs from that plan until the year they retire, if the plan allows it and they own less than 5% of the company that offers it. Employees with that level of ownership cannot delay, even while still on the payroll.
The delay covers the workplace plan only; traditional, SEP and SIMPLE IRAs follow the age 73 rule regardless of employment. If the plan does allow the delay, the first RMD from it is due by April 1 of the year following the later of the year you turn 73 or the year you retire. Plans differ, so ask your plan administrator how yours handles it.
What Happens if You Miss a Withdrawal or Take Too Little?
The IRS charges a 25% penalty on the amount you were required to withdraw but did not. The rate drops to 10% if you withdraw the missing amount and submit a corrected tax return within two years.
The traps are mostly about timing and aggregation. The first-year overlap between the April 1 option and the December 31 deadline catches people, and holders of several accounts sometimes forget that workplace plan withdrawals cannot be combined. If the calculations feel heavy, the plan administrator or IRA custodian can often compute the amounts for you, and a tax professional can help where the situation is more tangled.
Can You Withdraw Before Then?
Yes. The rules set an age when withdrawals become required, not a minimum age for taking money out. Withdrawals made before a certain earlier age can carry an additional tax under IRS rules, though exceptions exist, so check the details before taking money out early. After that earlier threshold and before 73, withdrawals are generally allowed without that extra tax, though they still count as taxable income unless the money was already taxed or comes from a Roth account.
Two other notes. Rules on taking money from a workplace plan while you are still employed vary by plan, so check with your administrator. And money you withdraw does not have to be spent: some people reinvest it in a nonretirement account, or look into qualified charitable distributions, which send IRA money directly to charity for those who qualify. Both options carry their own requirements, so check the details before counting on either.
- Roth IRA Myths That Stop People From Opening One: clears up common confusion about how Roth accounts really work.
- Roth 401(k) or Traditional 401(k): How They Compare: how the choice you make at work shapes withdrawals and taxes later.
- 401(k) vs. IRA: What Each Account Does Best: why withdrawal and RMD rules differ between the two account types.
Common questions
Q: At what age do RMDs start?
A: Generally at 73 for tax years 2023 and later, and the age rises to 75 in 2033. The first RMD is due April 1 of the year after you turn 73.
Q: Do Roth accounts have RMDs?
A: Not while the original owner is alive, for either a Roth IRA or a designated Roth account in a 401(k) or 403(b). Beneficiaries who inherit these accounts do follow RMD rules.
Q: Can I delay my 401(k) RMD if I keep working?
A: Often yes, if your plan allows it and you own less than 5% of the business sponsoring the plan. You can then delay withdrawals from that plan until the year you retire.
Q: What is the penalty for missing an RMD?
A: A 25% penalty on the amount not withdrawn. It drops to 10% if you take the missing amount and submit a corrected tax return within two years.
This article is for general information and education only and isn’t personal financial, tax or legal advice. Rates, fees and rules change, so check current details with the provider or an official source before making decisions.