Required minimum distributions: Overview and FAQ

What is a required minimum distribution?

Required minimum distributions are the minimum amounts you must withdraw from your retirement accounts each year. Generally, you must start taking withdrawals from your traditional IRA, SEP IRA, SIMPLE IRA, and retirement plan accounts when you reach age 73.

RMDs ensure that retirement savings that grew on a tax-deferred basis are eventually taxed as income. The amount you must withdraw varies based on your account balance and life expectancy, and failing to take the full required amount can result in penalties.

What types of retirement plans require minimum distributions?

The required minimum distribution rules apply to all employer sponsored retirement plans, including profit-sharing plans, 401(k) plans, 403(b) plans, and 457(b) plans. The RMD rules also apply to traditional IRAs and IRA-based plans such as SEPs, SARSEPs, and SIMPLE IRAs.

The RMD rules do not apply to Roth IRAs or Designated Roth accounts while the owner is alive. However, RMD rules do apply to the beneficiaries of Roth IRA and Designated Roth accounts.

How do you calculate required minimum distribution?

RMDs are generally calculated by taking the retirement account balance as of December 31 of the previous year and dividing it by a life expectancy factor from the applicable IRS table.

Most account owners use the Uniform Lifetime Table, though different tables may apply in some cases, such as when a spouse beneficiary is significantly younger. Because the divisor decreases as you age, required withdrawals often increase over time even if the account balance stays similar.

Example:
If your traditional IRA was worth $300,000 at year-end and your IRS factor is 26.5, then your minimum required distribution would be about $11,321.

Who is responsible for calculating the RMD?

Although the IRA custodian or retirement plan administrator may calculate the RMD, the account owner is ultimately responsible for taking the correct RMD amount.

What age does the required minimum distribution start?

For many individuals, required minimum distributions begin at age 73, though age 75 may apply for some younger cohorts under phased-in legislative changes. Your first RMD is generally due by April 1 of the year after you reach your required beginning age, and subsequent distributions are generally due by December 31 each year.

Because taking your first RMD late could result in two taxable distributions in one year, many retirees evaluate the tax impact before deciding when to take that first withdrawal.

Do I have to take a required minimum distribution if I am still working?

It depends on the type of retirement account. Traditional IRAs generally remain subject to RMD rules even if the account owner is still working. However, some employer-sponsored plans may allow participants to delay RMDs until retirement if the plan permits and certain ownership limitations are met. For tax professionals, reviewing plan rules and ownership status is important when advising clients on whether a delayed distribution may be available.

What is the required minimum distribution from an IRA?

The minimum required distribution from an IRA is calculated by dividing the prior December 31 balance by a life expectancy factor from IRS Publication 590-B tables. RMDs generally start at age 73, with the first payment due by April 1 of the following year, and subsequent payments due by December 31 annually. 

If you have multiple traditional IRAs, you generally calculate the RMD separately for each IRA, though you may be able to take the total amount from one or more of those IRAs.

What is the required minimum distribution on a 401(k)?

Required minimum distributions from a 401(k) generally begin at age 73, but participants in some workplace retirement plans may delay RMDs until the year they retire if the plan allows it and they are not 5% owners of the business sponsoring the plan.

Can the required minimum distribution be converted to Roth?

No, a required minimum distribution itself cannot be converted directly to a Roth IRA. Because an RMD is not an eligible rollover distribution, it generally cannot be rolled over or converted. You must take the RMD out of the account so it is treated as taxable income first.

However, after satisfying your RMD for the year, you may be able to convert additional amounts from a traditional IRA to a Roth IRA through a Roth conversion, depending on your broader tax and retirement planning strategy.

Are RMDs taxable?

Yes, RMDs are generally taxable as ordinary income in the year they are received. For most traditional IRAs and pre-tax 401(k) accounts, which means the amount withdrawn is typically included in taxable income for the year, potentially pushing the taxpayer into a higher tax bracket or affecting Social Security taxation.

However, after-tax basis, qualified distributions from certain Roth accounts, or other special circumstances may affect taxation, so the tax treatment can vary depending on the account and contribution history.

Can RMDs reduce Social Security benefits?

RMDs do not directly reduce a taxpayer’s Social Security benefit amount, but they can increase taxable income, which may affect how much of those benefits are subject to income tax. In some cases, higher income from RMDs may also affect Medicare premium surcharges (IRMAA), which can increase retirement-related costs.

For tax professionals and preparers, this is an important planning consideration. Coordinating the timing and amount of distributions may help manage taxable income, reduce the risk of triggering higher taxation of Social Security benefits, and potentially avoid crossing Medicare surcharge thresholds.

Are annuities subject to required minimum distributions?

It depends on the type of annuity. Qualified annuities held inside retirement accounts, such as a traditional IRA or 401(k), are generally subject to RMD rules. Non-qualified annuities purchased with after-tax dollars are not subject to RMD rules, although distributions may still have taxable income consequences. 

Do beneficiaries have to take RMDs on inherited IRAs?

Often, yes, though the rules depend on the type of beneficiary, when the account owner died, and whether the beneficiary qualifies for an exception under inherited IRA rules. Some beneficiaries may be subject to annual distributions, while others may be subject to a 10-year distribution window.

Because inherited IRA rules can be complex, tax preparers often review beneficiary status and distribution timing carefully to help avoid missed distributions or unintended tax consequences.

Can RMDs be donated to charity?

Yes, in some cases, a qualified charitable distribution (QCD) can be used to satisfy all or part of an IRA owner’s required minimum distribution. A QCD allows eligible taxpayers to direct funds from an IRA to a qualified charity, which may help reduce taxable income while meeting RMD obligations.

For tax professionals, QCDs can be an important planning tool for clients who are charitably inclined and looking to manage income thresholds or reduce the tax impact of distributions.

What is the penalty for not taking required minimum distribution?

If an account owner fails to withdraw the full amount of the required minimum distribution by the due date, the amount not withdrawn may be subject to an excise tax of 25%. This penalty can be reduced to 10% if the RMD is corrected within two years. The account owner should file Form 5329, Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts, with their federal tax return for the year in which the full amount of the RMD was required but not taken.

Failure to take a required minimum distribution can also result in standard income tax on the amount, and potential additional penalties if not corrected promptly.

Can you reinvest a required minimum distribution?

Yes, you can generally reinvest funds after taking a required minimum distribution, but the RMD itself must first be withdrawn and, in most cases, included in taxable income. Because an RMD is not an eligible rollover distribution, it generally cannot be rolled back into an IRA or converted directly to a Roth IRA.

However, after receiving the distribution, a taxpayer may choose to reinvest the funds in a taxable brokerage account, subject to their broader investment and tax planning goals. For tax professionals, this can create opportunities to discuss asset location, income planning, and whether other strategies, such as qualified charitable distributions or Roth conversions beyond the RMD amount, may be appropriate.

Where can tax professionals get help on required minimum distributions?

RMDs can affect both annual tax reporting and broader retirement planning, so it is important to handle them accurately and strategically.

Thomson Reuters UltraTax CS can help tax professionals calculate and report required minimum distributions on returns, while Ready to Advise can support more informed client conversations around withdrawal timing, tax impact, and retirement planning strategies.

Used together, these tools can help practitioners deliver clearer guidance and more confident advice.

We last updated this information on 06/03/2026.