Workers and retirees with Roth 401(k) or Roth 403(b) accounts no longer face mandatory withdrawals during their lifetimes. Congress eliminated the required minimum distribution rule for these designated Roth accounts as part of the SECURE 2.0 Act of 2022, and the change took effect for tax year 2024. The shift aligns workplace Roth accounts with the treatment Roth IRAs have long enjoyed, giving savers more control over when they tap their after-tax retirement savings.
How Section 325 of SECURE 2.0 rewrote the Roth 401(k) withdrawal rule
Before 2024, Roth 401(k) and Roth 403(b) participants had to begin taking required minimum distributions after reaching a certain age, even though the money had already been taxed on the way in. That put workplace Roth accounts at a disadvantage compared to Roth IRAs, which have never imposed lifetime RMDs. Section 325 of the SECURE 2.0 Act, enacted as Division T of the Consolidated Appropriations Act, 2023, closed that gap by exempting designated Roth accounts in employer-sponsored plans from RMD rules prior to the participant’s death.
Under the old framework, the Internal Revenue Code treated designated Roth accounts in employer plans the same way as traditional pre-tax accounts for distribution timing, even though the tax character of the money was different. Participants generally had to start withdrawals once they reached the applicable beginning date for RMDs, and plans were required to calculate and distribute those amounts each year. Failing to take an RMD could trigger significant tax penalties, and plan administrators had to track Roth and non-Roth balances separately while still enforcing the same timing rules.
The IRS confirmed the transition timeline in its Employee Plans News updates: designated Roth accounts in 401(k) and 403(b) plans were still subject to RMD rules for 2023, but for 2024 and later years, RMDs are no longer required from those accounts. That one-year lag matters because anyone who took a forced distribution from a Roth 401(k) in 2023 cannot undo it, while anyone who would have been required to withdraw in 2024 or beyond is now free to leave the funds untouched. The agency’s general guidance on required minimum distributions still applies to traditional accounts, but designated Roth balances now follow a different path during the owner’s lifetime.
IRS final regulations and the legal mechanics behind the change
The statutory fix works by adding a new subsection to the Internal Revenue Code. SECURE 2.0 Section 325 amended IRC Section 402A by inserting Section 402A(d)(5), which states that rules requiring minimum distributions to be paid during the employee’s lifetime do not apply to a designated Roth account. In other words, the law carves out Roth balances in defined contribution plans from the general RMD framework that continues to govern traditional 401(k) and 403(b) money.
The Treasury Department and IRS formalized this in Internal Revenue Bulletin 2024-33, which contains final regulations under IRC Section 401(a)(9) addressing the full range of RMD changes from SECURE 2.0. Those regulations explain how plan sponsors should administer the new rules, clarify that designated Roth accounts are exempt from lifetime RMDs starting in 2024, and coordinate the change with other distribution provisions. They also address how the exemption interacts with beneficiary rules after the participant’s death, an area where RMD requirements generally continue to apply.
The Government Accountability Office reported that the final regulations were issued under Treasury Decision TD 10001 and classified the rulemaking as a major rule, underscoring the significance of the change for retirement plan administration. The Congressional Research Service, in a nonpartisan analysis published as IF12750, stated that SECURE 2.0 (P.L. 117-328) removed the RMD requirement for designated Roth accounts effective as of 2024 and provided definitional clarity on what qualifies as a designated Roth account within a defined contribution plan. Together, these materials outline both the statutory authority and the practical guidance that plans must follow.
What the new Roth 401(k) rules mean for savers
For anyone holding a Roth 401(k) or Roth 403(b), the practical result is straightforward: as long as you are the original account owner, you no longer have to take RMDs from the Roth portion of your workplace plan during your lifetime. You can leave the money invested as long as the plan stays open to you, allowing potential tax-free growth to continue without being forced out on a government-set schedule.
This change gives Roth savers more flexibility in retirement income planning. Workers who prefer to draw down taxable or traditional pre-tax accounts first can now do so without worrying that their Roth 401(k) balance will trigger mandatory withdrawals. It also reduces the pressure to roll Roth 401(k) money into a Roth IRA solely to escape RMDs, though some savers may still choose rollovers for investment or administrative reasons.
Plan sponsors and administrators must update systems to distinguish clearly between Roth and non-Roth balances for distribution purposes, since only the designated Roth portion of a participant’s account is exempt from lifetime RMDs. Traditional 401(k) and 403(b) balances remain fully subject to required distributions, and beneficiaries who inherit designated Roth accounts generally continue to face post-death RMD rules. Even with those complexities, the core message for participants is simple: starting in 2024, designated Roth accounts in workplace plans enjoy the same lifetime RMD freedom that has long been a hallmark of Roth IRAs.
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