Internal Revenue Code Section 401(a)(9) sets the required minimum distribution rules that force owners of most tax-deferred retirement accounts to start pulling money out once they reach a specified age. For 2026, that age is 73 for anyone born between 1951 and 1959, and it rises to 75 for those born in 1960 or later once the rule phases in beginning in 2033.1Congressional Research Service. Required Minimum Distribution (RMD) Rules for Original Owners of Retirement Accounts The withdrawal amount is fixed by formula, the deadline is December 31 each year, and the penalty for coming up short is 25% of whatever you failed to take out.
When Your First RMD Is Due
Your first distribution year is the calendar year you reach your applicable age. You get one grace period, and only one: the first RMD can be delayed until April 1 of the following year, known as the required beginning date.2Internal Revenue Service. Retirement Plan and IRA Required Minimum Distributions FAQs Every RMD after that is due by December 31 of its own year.
The grace period sounds useful. It usually isn’t. If you turn 73 in 2026 and push your first withdrawal to April 1, 2027, you still owe the 2027 RMD by December 31, 2027. Two taxable distributions land in the same year, which can raise your marginal bracket, add Medicare premium surcharges, and pull more Social Security into taxable territory. Taking the first RMD in the year you actually turn 73 avoids the stacking problem.
Still-Working Exception
If you’re still employed by the company that sponsors your 401(k) or other workplace plan, you can defer RMDs from that plan until April 1 of the year after you retire.2Internal Revenue Service. Retirement Plan and IRA Required Minimum Distributions FAQs The exception has one firm limit. If you own more than 5% of the business sponsoring the plan, it doesn’t apply, and you begin RMDs at the statutory age like everyone else. The 5% test pulls in shares owned by your spouse and certain family members through constructive ownership rules, and it’s measured in the year you reach RMD age. Once you’re flagged as a 5% owner in that year, the label sticks for all future years even if you later sell the stake.
The still-working exception covers the current employer’s plan only. Traditional IRAs, SEP IRAs, and SIMPLE IRAs are outside its reach, and RMDs from those accounts begin at the statutory age regardless of your employment status.
Which Accounts Are Covered
Section 401(a)(9) reaches most tax-deferred retirement accounts:
- Traditional IRAs, including rollover IRAs
- SEP IRAs and SIMPLE IRAs
- 401(k) and 403(b) plans, on the pre-tax portions
- 457(b) governmental plans
- Profit-sharing and other qualified plans
Roth IRAs are exempt from RMDs during the original owner’s lifetime.3Internal Revenue Service. Retirement Topics – Required Minimum Distributions (RMDs) Starting in 2024, designated Roth accounts inside employer plans, such as Roth 401(k)s and Roth 403(b)s, are also exempt under Section 325 of SECURE 2.0. Inherited Roth accounts are a different matter: beneficiaries generally follow the same distribution timeline as inherited traditional IRAs, though the withdrawals come out tax-free.
How the RMD Is Calculated
The math is simple. Divide the account balance as of December 31 of the prior year by a life expectancy factor from the appropriate IRS table.3Internal Revenue Service. Retirement Topics – Required Minimum Distributions (RMDs)
Three tables exist, and which one applies depends on your situation:
- The Uniform Lifetime Table is the default and covers most account owners.
- The Joint Life and Last Survivor Table applies only when your sole beneficiary is a spouse more than 10 years younger than you. Its longer factor produces a smaller required withdrawal.4Internal Revenue Service. IRA Required Minimum Distribution Worksheet – Spouse 10 Years Younger
- The Single Life Expectancy Table is used by beneficiaries taking distributions from inherited accounts based on their own life expectancy.
An example on the Uniform Lifetime Table at age 73: the distribution period is 26.5. A $500,000 combined IRA balance on December 31 of the prior year produces an RMD of $500,000 ÷ 26.5, or $18,867.92. That amount must leave the account by December 31 of the current year.
Aggregation Across Accounts
You calculate the RMD separately for each account, but you don’t always have to withdraw from each account. The aggregation rules split by account type:
- Traditional, SEP, and SIMPLE IRAs can be aggregated. Add up all your IRA RMDs and pull the combined total from any one IRA or combination of them.5Internal Revenue Service. RMD Comparison Chart (IRAs vs. Defined Contribution Plans)
- 403(b) accounts follow the same rule within their own group.
- 401(k) and 457(b) plans do not allow aggregation. Each plan’s RMD must come out of that specific plan.
You cannot mix categories. IRA RMDs and 403(b) RMDs live in separate buckets, and taking extra from one won’t satisfy the other.
Penalties for a Missed or Short Distribution
The excise tax for failing to take a full RMD by December 31 is 25% of the shortfall.2Internal Revenue Service. Retirement Plan and IRA Required Minimum Distributions FAQs On a $20,000 RMD where you withdrew only $5,000, the penalty is 25% of the $15,000 gap, or $3,750. SECURE 2.0 cut this from the prior 50%.
The rate drops to 10% if you correct the shortfall within the correction window, which runs through the end of the second calendar year after the missed year.6Internal Revenue Service. IRS Notice 2024-35 – Certain Required Minimum Distributions for 2024 Miss a 2026 RMD, and you have until December 31, 2028 to take the missed amount and lock in the lower rate.
A full waiver is also possible when the shortfall was a reasonable error and you fix it promptly. Take the missed distribution as soon as you spot the mistake, then file Form 5329 with a letter explaining what happened. Enter “RC” and the shortfall amount on the dotted line next to line 54.7Internal Revenue Service. Instructions for Form 5329 The IRS grants these waivers regularly for genuine errors that are corrected quickly. Don’t wait for the decision before withdrawing the missed amount.
Qualified Charitable Distributions
If you give to charity anyway, a qualified charitable distribution is one of the more efficient ways to satisfy an RMD. A QCD sends money directly from your traditional IRA to a qualifying charity, and the amount counts toward your RMD without being added to your taxable income.
QCD eligibility starts at age 70½, which is earlier than the RMD age itself. The annual limit for 2026 is $111,000 per person, and each spouse in a married couple can hit that ceiling from their own IRAs. SECURE 2.0 also added a one-time option to direct up to $55,000 from an IRA to a charitable remainder trust or charitable gift annuity.
The transfer has to go directly from the IRA custodian to the charity. Route the check through your own hands and it fails as a QCD. On your return, report the full distribution on Line 4a of Form 1040, enter the taxable portion on Line 4b (often zero if the whole distribution was a QCD), and check the QCD box on Line 4c.8Internal Revenue Service. Publication 590-B – Distributions from Individual Retirement Arrangements (IRAs) The excluded amount is not also deductible on Schedule A; the income exclusion is the entire tax benefit.
Inherited Accounts Follow Different Rules
If you inherited a retirement account rather than owning it, the rules above are not the ones that govern your withdrawals. Final regulations issued in July 2024 and effective January 1, 2025 sort beneficiaries into categories, and most non-spouse individuals now must empty the inherited account within 10 years of the owner’s death.9Federal Register. Required Minimum Distributions Annual withdrawals during those 10 years are required if the original owner had already reached their required beginning date at death. A narrower group of eligible designated beneficiaries, including surviving spouses, minor children of the owner, disabled or chronically ill individuals, and beneficiaries not more than 10 years younger than the owner, can still stretch distributions over a life expectancy. Surviving spouses have the additional option of rolling the account into their own IRA, which restarts the clock under their own RMD age.10Internal Revenue Service. Retirement Topics – Beneficiary