Required minimum distributions no longer begin at one universal age. Federal law now divides retirees into birth-year groups: most people born from 1951 through 1959 reach the starting age at 73, while people born in 1960 or later generally reach it at 75. That distinction matters because missing a required withdrawal can trigger an excise tax, yet taking money earlier than required can unnecessarily accelerate taxable income and shrink the account’s tax-deferred balance.
The birth year determines whether 73 or 75 controls
SECURE 2.0 changed the applicable age in stages. The IRS’s current regulations state that 73 applies when a person reaches 73 before 2033, while 75 applies when the person reaches 74 after 2032. In practical birth-year terms, that generally places people born in 1951 through 1959 in the age-73 group and people born in 1960 or later in the age-75 group.
The first distribution is assigned to the year the applicable age is reached, but the payment can usually be delayed until April 1 of the following year. That extra time is not a free year. Someone who postpones the first RMD into the next calendar year generally must also take the second RMD by December 31, putting two taxable withdrawals on one return and potentially increasing Medicare income-related premiums two years later.
Traditional IRAs, SEP IRAs and SIMPLE IRAs are generally subject to the age rule even if the owner is still working. Employer plans can be different: a participant who is not a 5% owner may be able to wait until retirement if the plan permits. Roth IRAs owned by the original account holder do not require lifetime RMDs, and designated Roth accounts in workplace plans also stopped requiring lifetime distributions beginning in 2024.
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The amount comes from last year’s balance and an IRS factor
An RMD is not a fixed percentage printed on every account statement. The standard calculation divides the prior December 31 balance by a life-expectancy factor in an IRS table. Most owners use the Uniform Lifetime Table, while a different joint-life table can apply when the sole beneficiary is a spouse more than 10 years younger. The divisor falls with age, causing the required share of the account to rise over time.
Each IRA ordinarily has its own calculation, but an owner may aggregate traditional IRA RMDs and take the total from one or more IRAs. That flexibility does not extend across every account type. A 401(k) RMD generally must come from that plan, and a withdrawal from an IRA cannot satisfy a separate workplace-plan obligation. Inherited accounts also follow beneficiary rules that can differ sharply from the owner’s lifetime schedule.
Tax withholding and investment sales deserve planning before December. A retiree can often choose federal withholding on the distribution, but selling securities after a market drop simply to meet the deadline can lock in losses. Cash reserves, dividends or scheduled monthly withdrawals can spread the burden, while a qualified charitable distribution from an IRA can satisfy part or all of an RMD for an eligible owner without adding that donated amount to adjusted gross income.
A missed RMD is repairable, but delay gets expensive
The excise tax on an RMD shortfall is generally 25% of the amount that should have been withdrawn. The rate can fall to 10% when the shortfall is corrected within the statutory correction window and the required filing is completed. The IRS may also waive the tax when the failure resulted from reasonable error and the owner is taking reasonable steps to fix it, but a waiver is requested rather than assumed.
Correction begins with taking the missing amount as soon as the error is found, then documenting why it happened. Form 5329 is the return used to report additional taxes on retirement accounts and to request appropriate relief. Waiting for the custodian to solve the problem can be costly because the account owner, not the financial institution, remains responsible for the correct amount and deadline.
Beneficiary designations can also change the calculation after a spouse dies. An inherited IRA may be governed by a 10-year distribution deadline, annual RMDs or a life-expectancy schedule depending on the original owner’s status and the beneficiary’s relationship. Treating an inherited account like an owner’s personal IRA can produce the wrong divisor or deadline, so the death certificate, beneficiary paperwork and prior-year distribution history should be reviewed together before money moves.
The useful planning date is therefore not merely a birthday. It is the calendar year tied to the applicable age, the April 1 option for the first payment and the December 31 deadline for later payments. The IRS RMD FAQ remains the best checkpoint because it separates IRAs, workplace plans, inherited accounts and correction rules that a single age-based slogan cannot capture. Saving the year-end statements also creates a defensible record of the balance used in the calculation.
This article was produced with AI assistance and reviewed by The Money Overview editorial team.
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