A quick-reference guide to the terms you'll encounter when calculating, tracking, and taking Required Minimum Distributions. Whether you're looking up an IRS table name, an inherited IRA rule, or a penalty you've never heard of, each entry is a short definition — not a full explainer. For depth, follow the "Learn more" link.
Entries starting with a number (10-Year Rule, 401(k), 403(b)) appear first, followed by A–Z.
1
10-Year Rule
The rule that requires most non-spouse beneficiaries who inherited an IRA from someone who died after 2019 to fully empty the account within 10 years of the original owner's death. Whether annual distributions are also required during those 10 years depends on whether the original owner had already started taking their own RMDs. The clock started the year after death and was not paused during the IRS penalty waiver years (2021–2024).
Learn more: The 10-year rule explained
4
401(k)
An employer-sponsored retirement plan that allows employees to contribute pre-tax income (or after-tax, in the case of a Roth 401(k)). RMDs are required starting at age 73, unless the still-working exception applies. Unlike IRAs, 401(k) RMDs cannot be aggregated — each plan's RMD must be taken from that specific plan.
Learn more: 401(k) RMD rules
403(b)
A tax-deferred retirement plan available to employees of public schools, nonprofits, and certain other organizations. RMD rules are similar to 401(k)s, with one difference: RMDs from multiple 403(b) accounts can be aggregated (taken from a single 403(b) to cover the total). They cannot be combined with IRA or 401(k) RMDs.
Learn more: RMD rules by account type
A
Account Owner (Original Owner)
The person who originally opened and contributed to a retirement account. In inherited IRA rules, the distinction between the account owner and the beneficiary determines which IRS table applies, which deadlines apply, and whether the 10-year rule requires annual distributions. The owner's age at death — specifically, whether they had reached their Required Beginning Date — is one of the most important facts in the entire inherited IRA framework.
Learn more: Inherited IRA RMD rules
Aggregation (IRA RMDs)
The IRS rule that allows you to calculate the RMD for each of your Traditional IRAs separately, then withdraw the combined total from any one IRA (or any combination of IRAs). This flexibility applies only to IRAs — 401(k) RMDs must be taken from each plan individually. 403(b) accounts can aggregate with other 403(b)s but not with IRAs.
Learn more: How RMDs work
Annuity (Qualified vs. Nonqualified)
A financial product that provides a stream of income, typically in retirement. A qualified annuity is held inside a tax-deferred account (like an IRA) and is subject to RMD rules. A nonqualified annuity is purchased with after-tax money and is not subject to RMDs. If your IRA holds an annuity, the annuity's income payments may count toward your RMD — but the details depend on the contract.
Learn more: RMD rules by account type
B
Beneficiary
The person or entity designated to receive the assets in a retirement account after the account owner dies. The type of beneficiary — eligible designated, designated, or non-designated — determines the distribution rules and timeline for the inherited account. Beneficiary designations on file with the custodian generally override what's written in a will.
Learn more: Inherited IRA RMD rules
C
Custodian
The financial institution that holds your retirement account — for example, Fidelity, Schwab, or Vanguard. Your custodian processes distributions, reports your year-end balance to the IRS (on Form 5498), and may send RMD reminders. Some custodians calculate your RMD; most do not guarantee the number is correct. The responsibility to withdraw the right amount on time is yours.
Learn more: Does my accountant calculate my RMD?
Correction Window
The two-year period during which a missed or insufficient RMD can be corrected at a reduced penalty rate. If you withdraw the shortfall and file Form 5329 within two years of the original deadline, the excise tax is automatically reduced from 25% to 10% — no waiver letter needed. Beyond two years, the full 25% rate applies unless the IRS grants a reasonable cause waiver.
Learn more: What happens if you don't take an RMD
D
Designated Beneficiary
An individual named as the beneficiary of a retirement account who does not qualify as an Eligible Designated Beneficiary. The most common example is an adult child who inherits a parent's IRA. Designated beneficiaries are subject to the 10-year rule: the entire inherited account must be emptied within 10 years of the original owner's death.
Learn more: Non-spouse beneficiary RMD rules
Distribution (Withdrawal)
Any money taken out of a retirement account. An RMD is the minimum required distribution for a given year. You can always take more than the minimum, but excess withdrawals do not reduce future RMDs. Distributions from tax-deferred accounts are generally included in taxable income for the year they are taken.
Learn more: How to take an RMD
Distribution Year
The calendar year for which an RMD is calculated and must be withdrawn. Your age on December 31 of the distribution year determines which life expectancy factor to use — not your age when you run the calculation or request the withdrawal. For example, if you turn 78 in November 2026, you use the factor for age 78 for your 2026 distribution year.
Learn more: How RMDs work
E
Eligible Designated Beneficiary (EDB)
A special category of beneficiary exempt from the 10-year rule. EDBs can take inherited IRA distributions over their own life expectancy — similar to the pre-2020 "stretch" rules. Qualifying individuals include: a surviving spouse, a minor child of the deceased (until age 21), a person who is disabled or chronically ill, and a person not more than 10 years younger than the original owner.
Learn more: Inherited IRA RMD rules
Excise Tax (RMD Penalty)
The IRS penalty for failing to withdraw your full RMD by the deadline. The current rate is 25% of the shortfall — the difference between what you were required to withdraw and what you actually took. If corrected within two years, the rate is automatically reduced to 10%. In some cases, the IRS may waive the penalty entirely for reasonable cause. Before SECURE 2.0, the penalty was 50%.
Learn more: What happens if you don't take an RMD
F
Fair Market Value
The total value of your retirement account on a specific date — for RMD calculations, this means the account's value on December 31 of the prior year. Your custodian reports this figure on Form 5498 and on your year-end account statement. This is the numerator in the RMD formula.
Learn more: How RMDs work
Form 5329
The IRS form used to report a missed or insufficient RMD and calculate the excise tax owed. If you're requesting a penalty waiver for reasonable cause, you attach a letter of explanation to this form. Filing Form 5329 is also how you claim the reduced 10% penalty rate when you correct a shortfall within two years.
Learn more: IRS waiver for a missed RMD
Form 5498
An IRS information form that your custodian files (typically by May 31) reporting your IRA's fair market value as of December 31 of the prior year, along with any contributions or rollovers. You don't need to wait for this form to calculate your RMD — the same year-end balance appears on your December 31 account statement, which is usually available in January.
Learn more: How RMDs work
I
Inherited IRA (Beneficiary IRA)
A retirement account received from someone who has died. It must be retitled in the beneficiary's name — for example, "Jane Doe, beneficiary of John Doe, deceased." Non-spouse beneficiaries cannot roll an inherited IRA into their own IRA. The distribution rules depend on when the original owner died, whether they had started their own RMDs, and what type of beneficiary received the account.
Learn more: Inherited IRA RMD rules
IRS Publication 590-B
The official IRS publication that covers distributions from Individual Retirement Arrangements (IRAs). It contains the three life expectancy tables used to calculate RMDs (Uniform Lifetime, Joint Life, and Single Life), along with detailed rules for required distributions, inherited IRAs, and penalties. Updated annually. This is the primary source document for RMD calculations.
Learn more: RMD tables explained · IRS Publication 590-B (PDF)
J
Joint Life and Last Survivor Table (Table II)
One of three IRS life expectancy tables used to calculate RMDs. This table produces a smaller RMD than the Uniform Lifetime Table because it factors in two life expectancies. It applies only when the sole beneficiary of the account is the owner's spouse and that spouse is more than 10 years younger than the owner. If both conditions aren't met, you use the Uniform Lifetime Table instead.
Learn more: RMD tables explained
L
Life Expectancy Factor
The number you divide your account balance by to calculate your RMD. It comes from one of three IRS tables in Publication 590-B, based on your age (or the beneficiary's age) as of December 31 of the distribution year. The factor decreases each year as you age, which means the required withdrawal percentage gradually increases — even if your balance stays the same.
Learn more: How RMDs work
N
Non-Designated Beneficiary
A beneficiary that is not an individual — such as an estate, a charity, or certain types of trusts. Non-designated beneficiaries do not qualify for the 10-year rule or life expectancy distributions. Instead, they follow the 5-year rule (if the owner died before their RBD) or a "ghost" life expectancy rule based on the deceased owner's remaining life expectancy (if the owner died after their RBD).
Learn more: Non-spouse beneficiary RMD rules
O
Owner Died Before RBD / After RBD
The single most important fact for inherited IRA distribution rules. "Before RBD" means the original account owner died before reaching their Required Beginning Date — they hadn't started (or weren't yet required to start) taking their own RMDs. "After RBD" means they had. This distinction determines whether annual distributions are required during the 10-year window and which calculation method applies.
Learn more: The 10-year rule explained
P
Penalty Waiver Period (2021–2024)
The four-year window during which the IRS waived excise tax penalties for beneficiaries who missed annual RMDs under the 10-year rule. The IRS issued a series of notices (2022-53, 2023-54, 2024-35) granting this relief while finalizing the inherited IRA regulations. The waiver ended after 2024. Starting in 2025, the full 25% excise tax applies to missed inherited IRA distributions.
Learn more: Inherited IRA RMD rules
Q
Qualified Charitable Distribution (QCD)
A direct transfer from your IRA to a qualified charity that counts toward your RMD but is excluded from your taxable income. Available if you are age 70½ or older. The 2026 limit is $111,000 per person. The transfer must go directly from your custodian to the charity — it cannot pass through your hands first. QCDs can only be made from your own IRAs, not from inherited IRAs or employer plans.
Learn more: QCDs explained
R
Reasonable Cause Waiver
An IRS provision that allows the excise tax on a missed RMD to be waived entirely if you can demonstrate the shortfall was due to reasonable cause and you've taken steps to correct it. You request the waiver by filing Form 5329 with a letter explaining the circumstances. The IRS has historically been receptive when errors are corrected promptly and the explanation is credible.
Learn more: IRS waiver for a missed RMD
Required Beginning Date (RBD)
The deadline by which you must take your first RMD. For most account owners, this is April 1 of the year after you turn 73. The RBD is especially important in inherited IRA rules: whether the original owner died before or after their RBD determines whether annual distributions are required during the 10-year depletion window.
Learn more: When do RMDs start?
Required Minimum Distribution (RMD)
The minimum amount the IRS requires you to withdraw each year from tax-deferred retirement accounts (Traditional IRA, 401(k), SEP IRA, SIMPLE IRA, 403(b)) once you reach the starting age. Calculated by dividing your prior year-end account balance by an IRS life expectancy factor. The annual deadline is December 31. Failing to withdraw the full amount triggers a 25% excise tax on the shortfall.
Learn more: What is an RMD?
RMD Starting Age
The age at which you are first required to take an RMD. Under current law (SECURE 2.0 Act), this is 73 for anyone born between 1951 and 1959, and 75 for anyone born in 1960 or later (starting in 2033). You don't have to take the first distribution immediately — you can delay until April 1 of the following year, though this creates a double-up year.
Learn more: When do RMDs start?
Rollover
Moving funds from one retirement account to another — for example, from a 401(k) to an IRA. A direct rollover (trustee-to-trustee transfer) avoids taxes and penalties. The year-end balance used for your RMD calculation should reflect any rollovers completed during the prior year. Important: you cannot roll over an RMD itself — the required distribution must be taken before any rollover.
Learn more: How RMDs work
Roth 401(k) / Roth 403(b)
Employer-plan accounts funded with after-tax contributions. Starting in 2024, SECURE 2.0 eliminated lifetime RMDs for designated Roth accounts in employer plans — they are now treated like Roth IRAs during the owner's lifetime. However, beneficiaries who inherit these accounts are still subject to RMD rules (including the 10-year rule, if applicable).
Learn more: RMD rules by account type
Roth IRA
An individual retirement account funded with after-tax contributions. Roth IRAs do not require RMDs during the original owner's lifetime. However, beneficiaries who inherit a Roth IRA are subject to the 10-year rule (or life expectancy distributions for eligible designated beneficiaries). Qualified distributions from an inherited Roth IRA are generally tax-free if the account has been open for at least five years. Note: Qualified Charitable Distributions (QCDs) cannot be made from inherited Roth IRAs — only from your own Traditional IRAs.
Learn more: Roth IRA RMD rules
S
SECURE Act
The Setting Every Community Up for Retirement Enhancement Act of 2019 (Pub. L. 116-94). Its most significant RMD change: replacing the lifetime "stretch" distribution option for most inherited IRA beneficiaries with a 10-year depletion rule, effective for deaths occurring after December 31, 2019. It also raised the RMD starting age from 70½ to 72.
Learn more: The 10-year rule explained
SECURE 2.0 Act
The SECURE 2.0 Act of 2022 (Pub. L. 117-328). Key RMD changes include: raising the starting age to 73 (and 75 for those born in 1960 or later), reducing the excise tax penalty from 50% to 25% (and 10% if corrected within two years), and eliminating lifetime RMDs for Roth accounts in employer plans starting in 2024.
Learn more: When do RMDs start?
SEP IRA
A Simplified Employee Pension IRA, typically used by self-employed individuals and small business owners. RMD rules are identical to a Traditional IRA: distributions are required starting at age 73, and SEP IRA balances can be aggregated with other Traditional IRAs for RMD purposes.
Learn more: RMD rules by account type
Shortfall
The difference between the RMD amount you were required to withdraw and the amount you actually took. The IRS excise tax is calculated on the shortfall — not the full RMD. If your RMD was $15,000 and you withdrew $12,000, the shortfall is $3,000, and the 25% penalty applies to that $3,000.
Learn more: What happens if you don't take an RMD
SIMPLE IRA
A Savings Incentive Match Plan for Employees IRA, offered by small employers. RMD rules are the same as a Traditional IRA: required at age 73, calculated using the Uniform Lifetime Table, and balances can be aggregated with other Traditional IRAs. SIMPLE IRA contributions have a two-year waiting period before they can be rolled over to a Traditional IRA without penalty — but this does not affect RMD timing.
Learn more: RMD rules by account type
Single Life Expectancy Table (Table I)
The IRS life expectancy table used to calculate RMDs for beneficiaries of inherited IRAs. The beneficiary looks up their age in the year after the owner's death to find their initial factor, then reduces that factor by 1.0 each subsequent year. This produces a fixed, declining schedule — unlike the Uniform Lifetime Table, which is re-looked-up each year.
Learn more: RMD tables explained
Still-Working Exception
A provision that allows you to delay RMDs from your current employer's 401(k), 403(b), or similar plan if you are still employed by that employer past age 73. The plan must specifically allow this delay. The exception does not apply to IRAs, accounts from previous employers, or if you own 5% or more of the business. Once you retire, your first RMD is due by April 1 of the following year.
Learn more: When do RMDs start?
Stretch IRA (Legacy / Pre-2020)
The distribution method available to inherited IRA beneficiaries when the original owner died before January 1, 2020. Under these rules, beneficiaries could spread distributions over their own life expectancy — potentially decades. The SECURE Act replaced this with the 10-year rule for most beneficiaries, but pre-2020 inherited IRAs are grandfathered under the original stretch rules.
Learn more: Legacy stretch IRA schedules
Successor Beneficiary
A person who inherits an inherited IRA — the "second generation" beneficiary. For example, if your parent inherited an IRA and then passed away, you are the successor beneficiary. Successor beneficiaries are generally subject to the 10-year rule regardless of the original distribution method — even if the first beneficiary was on a life expectancy stretch.
Learn more: Non-spouse beneficiary RMD rules
T
Tax-Deferred Account
A retirement account where contributions or growth are not taxed until money is withdrawn. Traditional IRAs, 401(k)s, SEP IRAs, SIMPLE IRAs, and 403(b)s are all tax-deferred. RMDs exist because the IRS wants to ensure taxes are eventually collected on this money — they prevent indefinite deferral.
Learn more: What is an RMD?
Tax Professional / CPA
A Certified Public Accountant or other qualified tax professional. SimpleRMD calculates your required distribution and generates reports — but for questions about tax impact, withholding strategy, or how an RMD affects your specific situation, a tax professional is the right resource. Several SimpleRMD features are designed to make that conversation easier, including CPA-ready PDF exports.
Learn more: See how SimpleRMD works
Taxable Income
The portion of your income subject to federal income tax in a given year. RMDs from tax-deferred accounts (Traditional IRA, 401(k), SEP IRA, SIMPLE IRA) are included in your taxable income for the year the distribution is taken. This can affect your tax bracket, Medicare premiums (via IRMAA), and the taxation of Social Security benefits. One way to reduce the taxable impact: a Qualified Charitable Distribution (QCD) counts toward your RMD but is excluded from taxable income.
Learn more: How much tax do you pay on an RMD?
Traditional IRA
An individual retirement account that allows tax-deductible contributions (subject to income limits) and tax-deferred growth. RMDs are required starting at age 73, calculated using the Uniform Lifetime Table, with an annual deadline of December 31. The most common account type subject to RMD rules. Multiple Traditional IRAs can be aggregated for RMD withdrawal purposes.
Learn more: Required Minimum Distributions (RMDs)
U
Uniform Lifetime Table (Table III)
The default IRS life expectancy table used by most account owners to calculate their RMD. You look up your age as of December 31 of the distribution year and find the corresponding factor. Divide your prior year-end balance by that factor to get your RMD. The Joint Life Table (Table II) is used instead only when your sole beneficiary is your spouse and they are more than 10 years younger than you.
Learn more: RMD tables explained
W
Withholding
The portion of a distribution that your custodian sends directly to the IRS (or state tax authority) on your behalf. When you request an RMD, you choose how much to withhold — the default for IRA distributions is typically 10% federal withholding, but you can adjust this up or down. Withholding does not change your RMD amount; it only affects how much of the distribution you receive in cash versus how much goes toward your tax bill.
Learn more: How to take an RMD
This article is for informational purposes only and does not constitute tax, legal, or financial advice. IRS rules and tax laws are subject to change. Consult a qualified tax professional or financial advisor for guidance specific to your situation. SimpleRMD is a calculation and tracking tool — not a financial advisory service.
Sources: IRS Publication 590-B (PDF). IRS — Retirement Topics: Required Minimum Distributions. SECURE Act of 2019 (Pub. L. 116-94). SECURE 2.0 Act of 2022 (Pub. L. 117-328). IRS Final Regulations T.D. 10001 (July 2024). Rules confirmed current as of February 2026.