Let us help you calculate the required minimum distribution (RMD) from your retirement funds. We’ve broken down the calculations for you to better calculate your RMD and avoid any tax penalties.
Calculate your RMD in four steps:
IRS Uniform Lifetime Table
| Age | Distribution period in years |
|---|---|
| 72 | 27.4 |
| 73 | 26.5 |
| 74 | 25.5 |
| 75 | 24.6 |
| 76 | 23.7 |
| 77 | 22.9 |
| 78 | 22.0 |
| 79 | 21.1 |
| 80 | 20.2 |
| 81 | 19.4 |
| 82 | 18.5 |
| 83 | 17.7 |
| 84 | 16.8 |
| 85 | 16.0 |
| 86 | 15.2 |
| 87 | 14.4 |
| 88 | 13.7 |
| 89 | 12.9 |
| 90 | 12.2 |
| 91 | 11.5 |
| 92 | 10.8 |
| 93 | 10.1 |
| 94 | 9.5 |
| 95 | 8.9 |
| 96 | 8.4 |
| 97 | 7.8 |
| 98 | 7.3 |
| 99 | 6.8 |
| 100 | 6.4 |
| 101 | 6.0 |
| 102 | 5.6 |
| 103 | 5.2 |
| 104 | 4.9 |
| 105 | 4.6 |
| 106 | 4.3 |
| 107 | 4.1 |
| 108 | 3.9 |
| 109 | 3.7 |
| 110 | 3.5 |
| 111 | 3.4 |
| 112 | 3.3 |
| 113 | 3.1 |
| 114 | 3.0 |
| 115 | 2.9 |
| 116 | 2.8 |
| 117 | 2.7 |
| 118 | 2.5 |
| 119 | 2.3 |
| 120+ | 2.0 |
The base calculation for your RMD is the following:
Account balance Distribution period = RMD
Divide your account balance by your distribution. For example, if your account balance as of December 31, 2023, is $20,000, your age as of 2024 is 75 and your distribution period is 24.6, your RMD is $813.01.
You must calculate the RMD for each account by dividing your account balance by your distribution. But you don’t have to withdraw the amounts from each account to satisfy your annual RMD. You may choose to combine the RMD amounts and withdraw from only one account. For example:
Your total RMD for the year is $6,504.07. Choose to break up your withdrawal across multiple accounts or remove the entire amount from one account.
Use Table II in Appendix B of the IRS Joint Life and Last Survivor Expectancy table and choose the distribution period at the intersection of your age and your spouse’s age. For example:
If you have multiple accounts, you would use the same intersecting distribution period to calculate each account and then combine for the total amount you must withdraw for the year.
You have 10 years to take your money out if your beneficiary isn’t your spouse, according to Rubina Hossain, Certified Financial Planner at Annuity.org. “This is one of the biggest changes in the Secure Act, there is no longer the ability to “stretch” beneficiary IRAs over one’s lifetime for certain designated non-spouse beneficiaries. But if the beneficiary isn’t 10 years younger than the original deceased account owner, then they’re able to utilize the “stretch” IRA, which is to take the RMD amount over to the beneficiary’s lifetime or the five-year rule,” explains Hossain.
Prior to the passage of the 2019 Setting Every Community Up for Retirement Enhancement (SECURE) Act, you could stretch out inherited IRA distributions over your lifetime. But the new rules require nonspouse inheritors to take distributions that drain the account within 10 years of the account holder’s death. Basically, you now have 10 years to pay the taxes on any inherited tax-advantaged retirement accounts.
RMD is the minimum amount you’re required to withdraw from tax-advantaged retirement accounts each year until you pass away or the retirement fund is depleted. The RMD applies to most accounts starting at age 72. Roth IRAs do not require withdrawals until after the owner’s death, but beneficiaries of a Roth IRA are subject to the RMD rules. Designated Roth accounts in a 401(k) or 403(b) plan must follow the RMD rules for 2022 and 2023. However, for 2024 and later years, RMDs are no longer required from designated Roth accounts. 2023 RMDs due by April 1, 2024, are still required.
Most tax-advantaged retirement plans require an RMD, but there are a few nuances, depending on when you retire and how much of your employer’s company you own.
| Retirement account | Requires RMD? | Age |
|---|---|---|
| Traditional IRA | Yes | 72 |
| SEP IRA | Yes | 72 |
| Simple IRA | Yes | 72 |
| 401(k) | Yes | 72 or the first year after retirement, whichever is later |
| 403(b) | Yes | 72 |
| 457(b) | Yes | 72 |
| Profit-sharing plan | Yes | 72 |
| Employer contribution plan, and you own 5% or more of the company | Yes | 72, regardless of when you retire |
| Roth IRA | No | — |
| Roth 401(k) | Yes | 72 |
You must take your first annual RMD by April 1 of the year after you qualify. For example, if you turn 72 on December 15, 2024, you must take your RMD for the year by April 1, 2025. Every year after, you must take your entire RMD by December 31.
If you don’t take any distributions, or if the distributions don’t meet your calculated requirement, you’ll be subject to an excise tax on the amount not distributed.
If you don’t take a distribution for the year or take less than the RMD amount, you’re taxed 50% of the undistributed RMD. For example, if you’re required to take out $2,000 for the year, but you only take out $1,000, you’re subject to a 50% tax on the remaining $1,000.
After your first year, you can choose to withdraw your RMD as one large payment or set up smaller month-to-month automatic payments. Receive your RMD payment in one of the following ways:
Or, elect to have your taxes withheld from the withdrawals before they’re sent to you. If you choose not to, make sure that the RMD tax amount won’t result in an IRS underpayment penalty.
You can’t avoid or reduce the amount of your RMD. But if you don’t need the money for your retirement living expenses, there are ways to reduce the taxes you pay on your withdrawals.
It’s wise to understand what kind of distribution you’re required to take and plan what to do with the money. To get a better idea of what you can do with your accounts and what your options are, compare retirement savings accounts to find out what will work best for your retirement.
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