If you have money in retirement accounts, there is a point where the IRS stops letting you “leave it there forever.” That point is the Required Minimum Distribution, or RMD. And if you miss one, the penalty can be painful.
This guide breaks down the big rules: when RMDs start, which accounts are affected, how the math works, and the mistakes I see most often (including the Roth employer plan nuance that trips up a lot of people). I’ll keep this high-level and IRS-based, not personalized tax advice.
What an RMD is (in plain English)
An RMD is the minimum amount you must withdraw from certain retirement accounts each year after you reach a required age. The IRS created RMDs because many retirement accounts were funded with pre-tax dollars (or grew tax-deferred), and eventually the government wants to tax those dollars.
RMDs are not “extra taxes.” They are simply a withdrawal requirement. Whether your RMD is taxable depends on the account type and your specific situation.
- Traditional accounts (like a Traditional IRA or pre-tax 401(k)) usually have taxable RMDs.
- Roth IRAs typically have no RMDs during the original owner’s lifetime (but beneficiaries may have inherited-account rules).
RMD start ages you need to know
RMD rules have changed in recent years. In general, your “RMD age” depends on your birth year under SECURE Act changes.
Current general starting ages
- Age 73 for many retirees today (applies to people who reach age 72 after 2022).
- Age 75 for some younger cohorts (scheduled for those who reach RMD age later under the newer rules).
Best practice: Confirm your exact RMD start age with an IRS resource or your plan custodian based on your birth year. The IRS and plan providers often present this as “the year you turn age X.”
Your first RMD deadline (important)
Typically, your first RMD is due by April 1 of the year after the year you reach your RMD age. After that, RMDs are generally due by December 31 each year.
Heads up: If you delay your first RMD until the following year, you may end up taking two RMDs in the same calendar year (the delayed first one plus the second year’s RMD). That can increase taxable income and affect things like tax brackets or Medicare premium surcharges. This is where it can be worth getting professional help.
Which accounts have RMDs (and which do not)
RMDs apply to many tax-advantaged retirement accounts, but not all of them.
Accounts that commonly require RMDs
- Traditional IRAs
- SEP IRAs
- SIMPLE IRAs
- 401(k), 403(b), 457(b) plans (most employer retirement plans)
- Other qualified retirement plans that are tax-deferred
Accounts that usually do not have lifetime RMDs
- Roth IRA (for the original owner)
- Roth employer plans (like a Roth 401(k)) for the original owner, starting in 2024 under SECURE 2.0
Key nuance: Roth 401(k) rules changed. Before 2024, Roth employer plans generally did have lifetime RMDs, which is why you may still see older articles recommending a rollover to a Roth IRA to avoid them. Starting in 2024, SECURE 2.0 eliminated lifetime RMDs for Roth employer plans for the original owner. Rolling a Roth 401(k) into a Roth IRA can still make sense for other reasons (like investment options or consolidating accounts), but avoiding lifetime RMDs is no longer the main driver for most people. Plan rules vary, so confirm details with your plan provider.
How RMDs are calculated (the simple version)
Most RMDs follow a basic formula:
RMD = prior year-end account balance ÷ IRS life expectancy factor
In practice, that means:
- Your custodian looks at your account value as of December 31 of last year.
- They divide by a factor from an IRS life expectancy table (often the Uniform Lifetime Table for many account owners).
- The result is your required minimum distribution for this year.
Where the “factor” comes from
The IRS publishes life expectancy tables in its guidance. Different tables can apply depending on your situation, for example if your spouse is your sole beneficiary and is significantly younger. Custodians often calculate RMDs for you, but you are still responsible for making sure the correct amount is withdrawn by the deadline.
One big “gotcha” with multiple accounts
RMD aggregation rules can be confusing:
- Traditional IRAs: You can usually calculate the RMD for each IRA, then withdraw the total from one or more IRAs.
- 401(k)s and most employer plans: RMDs are typically per-plan. You generally cannot satisfy a 401(k) RMD by taking money from an IRA.
If you have several old 401(k)s from past jobs, this is where missed RMDs happen.
Inherited accounts: the high-level wrinkles
Inheritance changes the RMD conversation quickly. Rules depend on factors like: when the original owner died, your relationship to them, and whether you are considered an “eligible designated beneficiary” under IRS rules.
Common inherited account scenarios (high level)
- Spouse beneficiaries often have more flexible options than non-spouse beneficiaries, including the possibility of treating the account as their own in some cases.
- Non-spouse beneficiaries are often subject to a rule that the inherited account must be emptied within a certain time window (commonly referred to as the “10-year rule” for many designated beneficiaries).
- Some beneficiaries may still have annual distribution requirements depending on circumstances and IRS guidance.
Because inherited account rules have had updates and clarifications in recent years, this is one of those areas where I strongly recommend confirming your obligations with the plan custodian and a tax professional. You do not want to guess wrong with inherited retirement money.
The RMD penalty rules (and why you want a checklist)
Missing an RMD can trigger an IRS penalty tax on the amount you should have withdrawn but did not. The IRS has adjusted penalty levels in recent law changes, but the core message stays the same: missed RMDs are expensive and stressful.
What happens if you miss an RMD
- You may owe an excise tax penalty on the shortfall.
- You still have to take the distribution.
- You may need to file forms and request penalty relief if you qualify.
The IRS has a process for requesting a waiver in certain cases when the missed RMD was due to reasonable error and you are taking steps to fix it. If you missed an RMD, it is worth addressing quickly rather than hoping it goes unnoticed.
Common RMD mistakes (and how to avoid them)
Most RMD problems are not caused by complicated math. They are caused by life being busy and accounts being scattered.
1) Forgetting an old employer plan
If you have multiple 401(k)s from past jobs, each one may have its own RMD. Create a one-page list of every retirement account you own and where it is held. Update it once a year.
2) Outdated assumptions about Roth 401(k) RMDs
This one causes a lot of confusion because the rule changed. Starting in 2024, Roth employer plans (including Roth 401(k)s) are not subject to lifetime RMDs for the original owner under SECURE 2.0. If you are reading older advice, you may see recommendations to roll a Roth 401(k) into a Roth IRA to avoid RMDs. That was often true before 2024, but it is not the main reason now.
That said, you still do not want to assume a Roth 401(k) is identical to a Roth IRA in every way. Plan-level rules, investment menus, fees, and rollover options vary, so confirm your plan’s specifics before you move money.
3) Taking the wrong amount because the balance date is wrong
RMD calculations usually use the December 31 prior year balance. If you use today’s balance or an estimate, you can come up short.
4) Withholding surprises
RMDs often have taxes withheld automatically unless you change it. If you need the full RMD amount for spending, withholding can reduce what lands in your bank account. On the other hand, if you do not withhold enough, you may owe at tax time. This is a planning item to discuss with a pro.
5) Missing the first-year timing trap
Delaying your first RMD until April 1 of the following year can mean two RMDs in one year. Sometimes that is fine. Sometimes it is a tax headache. Know the tradeoff before you choose.
A simple RMD prep checklist
If you want an easy, low-stress system, here is what I recommend.
- List every retirement account you own (IRAs, 401(k)s, 403(b)s, etc.).
- Confirm your RMD age and your first-year deadline.
- Check which accounts require separate RMDs (employer plans often do).
- Set two calendar reminders: one in early fall, one in early December.
- Decide on withholding before you submit the distribution request.
- Keep proof: distribution confirmation and amount for your records.
IRS resources to look for (without getting lost)
If you want to verify rules straight from the source, search the IRS site for:
- “Required Minimum Distributions (RMDs)” (IRS overview pages)
- Life expectancy tables used for RMD calculations
- Rollovers and Roth rules if you are considering moving funds from a Roth 401(k) to a Roth IRA
- Inherited retirement accounts guidance if you are a beneficiary
When in doubt, your plan custodian can usually tell you what they believe your RMD is, but remember: the IRS ultimately considers the account owner responsible for meeting the requirement.
Bottom line
RMDs are one of those retirement rules that feel intimidating until you boil them down. Know your start age, know which accounts have RMDs, understand that employer plans often require separate withdrawals, and keep in mind that Roth employer plan RMD rules changed starting in 2024.
If you are approaching your RMD age or you inherited a retirement account, it can be worth a quick conversation with a qualified tax professional so you are acting on the right set of rules for your situation.