Workers who are still employed after they reach 73 may be able to hold off on required withdrawals from the 401(k) at the job where they still work. The IRS says a plan can let them wait until April 1 of the year after they retire. The exception does not reach 5% owners of the business that sponsors the plan, and it does not reach IRAs.
Both limits catch people who assume the delay follows the worker rather than the account. Someone who keeps a traditional IRA while still working at 73 gets no pause, even though the 401(k) down the hall might.
How the still-working delay works
The IRS’s page on required minimum distributions says an employer plan such as a 401(k), 403(b) or profit-sharing plan can let an employee delay the withdrawal until retirement. The required beginning date in that case is April 1 of the year after the later of two events: reaching 73 or retiring.
That language tracks the tax code. Section 401(a)(9)(C) defines the required beginning date as April 1 of the calendar year following the later of the year the employee reaches the applicable age or the year the employee retires, according to the text on Cornell Law School’s Legal Information Institute. The statute sets the applicable age at 73 for people who reach it before Jan. 1, 2033, and at 75 for people who reach 74 after Dec. 31, 2032.
So a worker who turned 73 in 2026 and keeps working at the company has no required withdrawal from that company’s plan for 2026 if the plan allows the delay. The clock starts at retirement, not at the birthday.
The plan has to allow it
The delay is an option the plan offers, not a right the employee holds. The IRS page says a plan “may require you to begin receiving distributions after you reach age 73, even if you’re still employed.” The page frames the rule as applying “if your plan allows you to delay taking your RMD until retirement.”
The question for workers past 73 is which accounts they hold and which of them are covered by the delay. Anyone with a 401(k) at a current job, a 5% ownership stake in the employer, or an IRA from an earlier job should check each against the plan’s own rules before assuming a withdrawal can wait.
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The plan administrator holds the answer on whether the delay is available. The summary plan description or a call to the plan’s benefits office will show whether the plan lets active employees defer withdrawals past 73.
Who is left out: 5% owners and IRA owners
The IRS’s required minimum distribution FAQs say plan participants can delay withdrawals until the year they retire “unless they’re a 5% owner of the business sponsoring the plan.” The statute says the retirement prong does not apply to a 5-percent owner as defined in section 416 of the code.
For these owners the withdrawals start under the age rule, with the first one due by April 1 of the year after they reach 73.
IRA owners are shut out of the delay altogether. The FAQ says owners of traditional, SEP and SIMPLE IRAs must begin required withdrawals once the account holder is 73, even if retired. Whether the owner is working or not has no effect on an IRA.
Roth accounts, penalties and the next deadline
Roth money sits outside the question. The IRS pages say withdrawals from Roth IRAs and designated Roth accounts in a 401(k) or 403(b) are not required while the owner is alive, so the still-working delay matters only for pre-tax balances.
After the first withdrawal, each later required distribution is due by Dec. 31, the IRS says. A worker who retires and delays to April 1 can therefore owe a second withdrawal on Dec. 31 of that same year. The IRS FAQ shows the same pattern for owners who reach 73: a first distribution due April 1 and a second due by Dec. 31 of that year.
A withdrawal that falls short can trigger an excise tax of 25% on the amount not taken, or 10% if the shortfall is corrected within two years, the IRS says. The tax is reported on Form 5329, and the FAQ says the IRS can waive it for a reasonable error when reasonable steps are taken to fix the shortfall.
The IRS also notes that some pre-1987 403(b) amounts follow their own timing. Those amounts need not be distributed until April 1 of the year after the participant retires.
For a worker who plans to keep going past 73, the practical sequence is to confirm the plan’s delay in writing, keep any IRA withdrawals on schedule and mark the April 1 and Dec. 31 dates after the last day on the job.
Still working at 73 with a 401(k)?
The still-working delay protects only the plan balance at the job, and a missed withdrawal anywhere else triggers the 25% excise tax. A worker who forgets that an old IRA is on a different clock can owe tax on the amount left behind.
Cut Your Retirement Tax Bill: 12 Moves covers taking RMDs on time, without the 25% penalty or the first-year trap, in 2026 numbers. It also names the forms to use, including Form 5329.
The guide puts the 2026 numbers on one page and opens with a 60-second scan, so the RMD move can be found without reading the whole book.
Get the RMD guide with the plan-delay rules and Form 5329 steps →
This article was produced with AI assistance and edited for accuracy against the sources linked above.
