What is a required minimum distribution?
A required minimum distribution (RMD) is the minimum amount you generally must withdraw each year from traditional IRAs and most employer retirement plans, such as 401(k)s, once you reach the required age. Under current law, that age is 73 for most people. For each year after your first RMD year, the withdrawal is generally due by December 31.
Guidance reviewed October 23, 2026. This summary follows IRS RMD guidance. Rules for inherited accounts, still-working employees and special situations differ, and the law can change. Confirm your situation with your plan administrator, IRA custodian or a tax professional. The cover is an AI-generated conceptual illustration.
Which accounts have RMDs?
RMDs generally apply to traditional IRAs, SEP and SIMPLE IRAs, and employer plans such as 401(k), 403(b) and 457(b) plans. Roth IRAs do not require withdrawals while the original owner is alive. Since 2024, designated Roth accounts in workplace plans are also exempt from lifetime RMDs.
If you are still working, some employer plans let you delay RMDs from that plan until you retire, unless you own 5% or more of the business. This exception does not apply to IRAs.
When is the first RMD due?
Your first RMD can be delayed until April 1 of the year after you reach the required age. Every later RMD is due by December 31. If you delay the first one, you will take two RMDs in that following year, which can increase your taxable income for that year.
How is the RMD calculated?
For each account, take the balance on December 31 of the prior year and divide it by the life-expectancy factor from the IRS Uniform Lifetime Table for your age. A different table applies if your sole beneficiary is a spouse more than 10 years younger.
If you have several traditional IRAs, you calculate each RMD separately but can withdraw the total from any one or more of them. For 401(k) plans, RMDs generally must come from each plan separately.
Worked example
Suppose a hypothetical retiree turns 75 this year and had $300,000 in a traditional IRA on December 31 of last year. The IRS Uniform Lifetime Table factor for age 75 is 24.6.
$300,000 ÷ 24.6 ≈ $12,195
She can take it all at once or spread it out, as long as the total is withdrawn by December 31. The withdrawal is generally taxed as ordinary income. She may ask her custodian to withhold federal tax so she does not owe a large balance at filing time.
What happens if you miss an RMD?
The shortfall can be subject to an excise tax of 25%. If you correct the missed amount in a timely way, the tax may be reduced to 10%, and the IRS can waive it for reasonable error when you file Form 5329 with an explanation. Do not assume a waiver; correct it as soon as you notice.
A year-end RMD checklist
- List every traditional IRA and workplace plan you own.
- Confirm each account's prior December 31 balance.
- Check whether your custodian has calculated the RMD for you.
- Decide on withholding before the withdrawal.
- Leave buffer time: custodians may need several business days in late December.
- If you give to charity and are 70½ or older, ask about qualified charitable distributions from an IRA, which can count toward your RMD.
How MoneyPatrol can help
An RMD often lands as one large deposit. MoneyPatrol can help you see that money arrive in supported connected accounts and plan how it fits your monthly budget. It does not calculate RMDs, file tax forms or provide tax advice.
For more year-end planning, read the 2026 year-end tax checklist and our US tax basics guide.
Official sources
MoneyPatrol is not a financial, tax, investment, legal or accounting advisor. This article is for general educational purposes only and is not a substitute for personalised advice from a qualified professional. See our full disclaimer.
