Required minimum distributions (RMDs) are the withdrawals the IRS makes you take from most retirement accounts once you reach your 70s. They matter because every dollar counts as taxable income, and a large RMD can raise your tax bracket, make more of your Social Security taxable and push up your Medicare premiums. Here’s what RMDs are, how the amount is worked out, and how to plan so they don’t catch you out.
Key takeaways
- RMDs start at 73 if you were born 1951–1959, and at 75 if you were born in 1960 or later.
- Your RMD is your December 31 balance divided by an IRS life-expectancy factor.
- RMDs are taxed as ordinary income and can trigger higher Social Security taxation and Medicare IRMAA surcharges.
- Missing an RMD costs a 25% excise tax on the shortfall (10% if corrected within two years).
- Roth conversions before RMDs begin, and qualified charitable distributions after, are the two main ways to reduce the tax hit.
What an RMD actually is
A required minimum distribution is the amount the IRS forces you to pull out of a tax-deferred account each year, whether you need the money or not. It applies to traditional IRAs, SEP and SIMPLE IRAs, and most employer plans like 401(k)s. Roth IRAs are exempt during your lifetime. Under current rules, RMDs start at age 73 if you were born between 1951 and 1959, and at age 75 if you were born in 1960 or later. Skip one, or take less than required, and the penalty is steep: a 25% excise tax on the shortfall, which drops to 10% if you correct it within two years.
How the amount gets calculated
Take your account balance as of December 31 of the prior year, then divide by a life-expectancy factor from the IRS Uniform Lifetime Table. A $500,000 balance at age 75 uses a factor of 24.6, which works out to roughly $20,325 for the year. The number isn’t fixed: it shrinks every year as the divisor gets smaller, so the required withdrawal as a percentage of your balance climbs the longer you live. If you have several traditional IRAs, you can total the RMDs and take the combined amount from just one of them. Workplace plans don’t work that way — each 401(k) needs its own withdrawal.
Where RMDs collide with the rest of your taxes
An RMD counts as ordinary income the moment it lands in your account, even if you don’t spend a dollar of it. That income can push more of your Social Security into taxable territory, and if you’re on Medicare, it’s exactly the kind of income spike that triggers an IRMAA surcharge two years later. A retiree who takes a $40,000 RMD on top of Social Security and a pension can end up with a materially higher Medicare premium without ever noticing the connection until the surcharge notice arrives.
A few ways to soften the hit
Qualified charitable distributions let you send up to $111,000 directly from an IRA to a charity in 2026, and the amount counts toward your RMD without showing up as taxable income. Roth conversions done in the years before RMDs start can shrink the traditional-IRA balance the formula is based on, which lowers every future RMD. If you’re still working past your RMD age and don’t own more than 5% of the company, your current employer’s plan may let you delay RMDs from that one account — though any IRA you hold still has to follow the regular schedule.
RMD factors at a glance
These are the divisors from the IRS Uniform Lifetime Table, which most account owners use. The percentage shows roughly how much of your balance you must withdraw at each age.
| Age | Factor | Approx. % of balance | RMD on $500,000 |
|---|---|---|---|
| 73 | 26.5 | 3.8% | $18,868 |
| 75 | 24.6 | 4.1% | $20,325 |
| 80 | 20.2 | 5.0% | $24,752 |
| 85 | 16.0 | 6.3% | $31,250 |
| 90 | 12.2 | 8.2% | $40,984 |
If your spouse is your sole beneficiary and more than 10 years younger than you, you use the Joint Life Expectancy Table instead, which produces a smaller RMD.
Your first RMD: the April 1 trap
You can delay your very first RMD until April 1 of the year after you reach RMD age. Every RMD after that is due by December 31. The catch is that delaying the first one means taking two RMDs in the same tax year, which can push you into a higher bracket and trigger IRMAA. For many people, taking the first RMD in the year they turn 73 (or 75) is the cheaper choice.
Inherited IRAs follow different rules
Most non-spouse beneficiaries who inherit an IRA must empty it within 10 years of the original owner’s death. If the owner had already started RMDs, the beneficiary generally also has to take annual withdrawals in years one to nine. Spouses, minor children, disabled or chronically ill beneficiaries, and people not more than 10 years younger than the owner have more flexible options. Inherited Roth IRAs also fall under the 10-year rule, but withdrawals are usually tax-free.
Frequently asked questions
At what age do RMDs start?
Age 73 if you were born between 1951 and 1959, and age 75 if you were born in 1960 or later.
Do Roth IRAs have RMDs?
Not while the original owner is alive. Since 2024, Roth 401(k)s are also exempt from lifetime RMDs.
Can I reinvest my RMD?
Yes, but not back into a traditional IRA. You can move it into a regular taxable brokerage account, or into a Roth IRA if you have earned income that qualifies you to contribute. The RMD itself is still taxed in the year you take it.
Can I take my RMD in one lump sum or monthly?
Either. The IRS only cares that the full amount is out by the deadline. Many retirees set up monthly withdrawals with tax withheld, which works like a paycheck and avoids a surprise tax bill.
For more ways to keep RMDs from raising your taxes, see our guide to Roth conversions in retirement and how to avoid IRMAA Medicare surcharges.
Plan your withdrawals with confidence. The Essential Retirement Tax Strategy Guide covers RMDs, Roth conversions, IRMAA and withdrawal order in plain English, with worked examples.
Estimate your own required withdrawal for this year with the RMD Calculator.
