Identify which accounts and dates are involved
A required minimum distribution is an annual minimum withdrawal rule for particular retirement accounts. The IRS says the rules generally apply to traditional IRAs, SEP and SIMPLE IRAs, and employer retirement plans, including 401(k), 403(b), and 457(b) plans. The account title matters before any calculation begins.
For many owners, the starting age is 73. A workplace-plan participant may be able to delay a first RMD until retirement, unless the participant is a 5% owner of the sponsoring business. Traditional IRA, SEP IRA, and SIMPLE IRA rules do not use that same still-working delay. Confirm the year, the employment facts, and the provider’s current instructions rather than relying on an age alone.
Calculate separately before deciding where to take the money
The IRS generally calculates an RMD for each account from the prior December 31 balance and a published life-expectancy factor. The applicable table can depend on beneficiary facts, so an account balance alone is not a complete calculation.
IRAs must be calculated separately, although their total RMD can generally be withdrawn from one or more IRAs. The same aggregation approach applies to 403(b) contracts. RMDs from 401(k) and 457(b) plans generally must be taken separately from each plan account. Ask the custodian or plan administrator to explain the figures and keep the calculation record with your tax documents.
Treat the first-year timing as a two-year cash and tax question
The IRS allows a first RMD to be delayed until April 1 of the following year in the circumstances it describes. That choice can place the first and second RMD in the same calendar year, because the second annual RMD is due by December 31. Before deciding on timing, collect the projected income, withholding, estimated-tax, and benefit questions for both years.
An RMD can be larger than the minimum, but an extra amount from one year does not satisfy a future year’s RMD. RMD amounts also cannot simply be rolled over into another tax-deferred account. A calculator that does not use the applicable IRS table and full account facts should not be treated as an RMD calculation.
Review Roth, beneficiary, and missed RMD situations separately
Roth IRAs and designated Roth accounts are not subject to lifetime RMDs while the owner is alive under the current IRS guidance. Beneficiaries can still have RMD rules, so a Roth label does not make an inherited account deadline-free.
If you think an RMD was missed, obtain the provider’s calculation and tax records promptly. The IRS says a shortfall may be subject to an excise tax and describes Form 5329 and a possible waiver process when the applicable conditions are met. This is a record-and-review issue, not a reason to guess at a catch-up amount.