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Required minimum distributions (RMDs) for pre-tax retirement accounts begin at age 73 for account holders born between 1951 and 1959.
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The Secure 2.0 Act ended RMDs for Roth 401(k) and Roth 403(b) plans while the original account holder is alive, although beneficiaries must still receive RMDs.
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In general, RMDs must be completed annually by December 31; failure to take the RMD on time results in a penalty of up to 25%, although it can be reduced to 10%.
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Retirement accounts such as traditional individual retirement accounts (IRAs) and 401(k) plans can reduce your current taxable income, allowing you to invest pre-tax dollars. Instead, the account holder must pay federal income tax on withdrawals (ie, contributions and earnings) in the future.
Withdrawals cannot be postponed indefinitely. Tax-deferred retirement accounts are subject to required minimum distribution (RMD) rules, meaning account holders must make enough withdrawals each year once they reach a certain age.
RMD rules can be confusing, especially with the relatively recent changes brought by the Secure 2.0 Act in 2022. Read on to learn about three rules that retired workers need to know in 2026.
The age at which RMDs start depends on when you were born. Secure Act 1.0 (2019) raised the starting age from 70 1/2 to 72 for people born on or after July 1, 1949. Then, Secure Act 2.0 (2022) raised the starting age to 73 for people born on or after January 1, 1951.
|
Date of birth of the account holder |
Age at which RMDs begin |
|---|---|
|
Before July 1, 1949 |
70 1/2 |
|
July 1, 1949 to December 31, 1950 |
72 |
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January 1, 1951 to December 31, 1959 |
73 |
|
After December 31, 1959 |
75 |
Data source: Internal Revenue Service. RMD = required minimum distribution.
Importantly, RMDs from traditional 401(k) plans and traditional IRAs (including SEP IRAs and SIMPLE IRAs) are required at the minimum age shown in the chart above, even if you are still working. Generally, RMDs must be completed by December 31st, but the first can be deferred until April 1st of the following year.
Here’s an example: Ben turns 73 in 2026, so he needs to start taking RMDs. He is allowed to defer the first withdrawal until April 1, 2027, but the second withdrawal must be taken by December 31, 2027. And all subsequent RMDs must be taken by December 31 of the applicable year.