RMD Help Center
Everything you need to know about Required Minimum Distributions
Important Disclaimer
A Required Minimum Distribution (RMD) is the minimum amount you must withdraw from your tax-advantaged retirement accounts each year once you reach a certain age.
For most people, RMDs begin at age 73 (as of 2023 under SECURE 2.0). If you were born before 1951, your RMD age was 70½; if born between 1951-1959, it was 72.
The purpose of RMDs is to ensure that retirement funds are eventually taxed as income, rather than being passed on as part of an estate without ever being taxed.
Accounts Subject to RMDs:
- Traditional IRAs
- SEP IRAs
- SIMPLE IRAs
- 401(k), 403(b), and most employer plans
- Inherited IRAs (different rules apply)
Note: Roth IRAs are NOT subject to RMDs during the original owner's lifetime. However, inherited Roth IRAs have distribution requirements.
Your RMD is calculated by dividing your prior year-end account balance (December 31) by a life expectancy factor from IRS tables.
RMD = Account Balance (Dec 31) ÷ Life Expectancy Factor
IRS Life Expectancy Tables
Uniform Lifetime Table
The default table for most IRA owners. Assumes your beneficiary is 10 years younger than you, even if they're not. Used unless your spouse is your sole beneficiary AND more than 10 years younger.
Example: At age 73, the factor is 26.5. With a $500,000 balance: $500,000 ÷ 26.5 = $18,868 RMD
Joint Life and Last Survivor Table
Used only when your spouse is your sole beneficiary AND is more than 10 years younger than you. Results in smaller RMDs due to the longer joint life expectancy.
Single Life Expectancy Table
Used by beneficiaries of inherited IRAs to calculate their RMDs based on their own age. Also used by some spouse beneficiaries who remain as beneficiaries rather than rolling over.
The SECURE Act of 2019 dramatically changed distribution rules for inherited IRAs. For most non-spouse beneficiaries who inherit after December 31, 2019, the entire inherited IRA must be distributed within 10 years of the original owner's death.
Who the 10-Year Rule Applies To:
- Adult children of the decedent
- Siblings, friends, and other non-spouse beneficiaries
- Most trusts named as beneficiaries
- Minor children once they reach age 21
Exceptions (Eligible Designated Beneficiaries):
These beneficiaries can still use the "stretch" life expectancy method:
- Surviving spouse (can also roll over to own IRA)
- Minor children of the decedent (until age 21, then 10-year starts)
- Disabled individuals (IRS definition)
- Chronically ill individuals
- Beneficiaries not more than 10 years younger than the decedent
Annual RMDs During the 10 Years
Important clarification from 2024 IRS guidance: If the original owner died on or after their Required Beginning Date (RBD), you must take annual RMDs during the 10-year period, in addition to fully emptying the account by year 10.
RMD Penalty Waiver Extended (Notice 2024-35)
The IRS has extended the waiver of penalties for missed 2024 RMDs for certain inherited IRA beneficiaries affected by the 10-year rule confusion. This applies to beneficiaries who inherited from someone who died after their RBD.
Final 10-Year Rule Regulations (July 2024)
The IRS issued final regulations confirming that annual RMDs ARE required during the 10-year window if the original owner died on or after their RBD. These rules are effective for 2025.
SECURE 2.0 RMD Age Increase
The RMD starting age increased to 73 in 2023 and will increase to 75 in 2033. Check your birth year to determine when you must begin taking RMDs.
When you inherit an IRA, your distribution options depend on your relationship to the deceased owner, when they died, and whether they had started taking RMDs.
Spouse Beneficiaries
Surviving spouses have the most flexibility:
- Roll over to own IRA: Treat it as your own IRA with your own RMD schedule
- Remain as beneficiary: May delay RMDs if deceased hadn't reached RBD
- 10-year payout: Optional, no annual RMDs required
Non-Spouse Beneficiaries (EDBs)
Eligible Designated Beneficiaries can use the life expectancy method:
- Calculate RMD using Single Life Expectancy Table
- Reduce the factor by 1 each subsequent year
- May also choose 10-year payout if preferred
Non-Spouse Beneficiaries (Non-EDBs)
Subject to the 10-year rule:
- Must fully distribute within 10 years of death
- If deceased was past RBD: annual RMDs also required
- If deceased was before RBD: no annual RMDs, just empty by year 10
Failing to take your full RMD by the deadline results in an excise tax (penalty) on the amount you should have withdrawn but didn't.
25%
Standard Penalty
Applied to the RMD shortfall amount
10%
Corrected Penalty
If corrected within the "correction window"
How to Correct an RMD Shortfall:
- Take the missed distribution as soon as possible
- File Form 5329 with your tax return
- Pay the 10% penalty (if corrected in time) or 25% penalty
- Attach a letter explaining the error and the correction
The "correction window" is generally until the end of the second tax year after the year the shortfall occurred. Consult a tax professional for specific guidance.
RMD
Required Minimum Distribution - the minimum amount you must withdraw from retirement accounts each year after a certain age or when inheriting an IRA.
RBD
Required Beginning Date - the date by which you must begin taking RMDs. Generally April 1 following the year you turn 73.
EDB
Eligible Designated Beneficiary - a beneficiary who can stretch distributions over their lifetime instead of the 10-year rule. Includes spouses, minor children, disabled/chronically ill, and those within 10 years of the decedent's age.
FMV
Fair Market Value - the total value of your account as of December 31 of the prior year, used to calculate your RMD.
SECURE Act
Setting Every Community Up for Retirement Enhancement Act of 2019 - legislation that changed RMD rules, most notably introducing the 10-year rule for most inherited IRAs.
SECURE 2.0
SECURE 2.0 Act of 2022 - additional retirement legislation that raised RMD ages, reduced penalties, and made other changes.
Stretch IRA
The ability to stretch inherited IRA distributions over the beneficiary's lifetime. Now only available to Eligible Designated Beneficiaries.
Life Expectancy Factor
A number from IRS tables used to calculate RMDs. Your prior-year-end balance is divided by this factor.
Successor Beneficiary
Someone who inherits an inherited IRA from the original beneficiary. Subject to the 10-year rule from the death of the original beneficiary.
Custodian
The financial institution that holds your IRA (e.g., Fidelity, Schwab, Vanguard). They're responsible for tracking your account and sending annual RMD notices.
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