Understand your Required Minimum Distribution
If you're approaching retirement or already taking distributions from your retirement accounts, understanding your Required Minimum Distribution is an important part of managing your financial plan. The IRS requires most retirement account holders to begin withdrawing a minimum amount each year, starting at age 73 (or 75 if you were born in 1960 or later).
Use our free RMD calculator below to estimate your required distribution for the current year. Simply enter your date of birth, account balance, and beneficiary information to see your results.
Required Minimum Distribution Calculator
Estimate your annual required minimum distribution from your retirement account.
What is a required minimum distribution?
A Required Minimum Distribution (RMD) is the minimum amount you must withdraw annually from most tax-deferred retirement accounts, including Traditional IRAs, 401(k)s, and 403(b)s. These distributions are generally treated as taxable income in the year they are received.
The purpose of RMDs is straightforward: the tax benefits you received while contributing to your retirement accounts were designed to help you save for retirement — not to pass wealth to heirs indefinitely. RMDs ensure those savings eventually become taxable income.
When Do RMDs Begin?
Your RMD start date depends on your birth year:
- Born 1950 or earlier: RMDs began at age 72
- Born 1951–1959: RMDs begin at age 73
- Born 1960 or later: RMDs begin at age 75
Your first RMD must be taken by April 1 of the year following the year you reach your RMD age. All subsequent RMDs are due by December 31 each year. Keep in mind that delaying your first distribution may result in two taxable distributions in a single year.
How Is Your RMD Calculated?
Your RMD is determined by dividing your retirement account balance (as of December 31 of the prior year) by a life expectancy factor from IRS-published tables. Most account holders use the Uniform Lifetime Table (Table III). If your spouse is your sole beneficiary and is more than 10 years younger than you, the Joint Life and Last Survivor Expectancy Table (Table II) may apply, which typically results in a smaller required distribution.
Important Things to Know
- Roth IRAs are not subject to RMDs during the account owner's lifetime. As of 2024, designated Roth accounts in employer plans (Roth 401(k) and Roth 403(b)) are also exempt from RMDs under the SECURE Act 2.0.
- Multiple accounts: If you have more than one Traditional IRA, your RMD is calculated separately for each account, but you may take the total amount from any one or combination of your IRAs. However, 401(k) RMDs must generally be taken from each 401(k) account individually.
- Penalties for missed RMDs: Failing to take your full RMD by the deadline may result in a penalty of 25% of the amount not distributed (reduced from the previous 50% penalty under SECURE Act 2.0). This penalty may be further reduced to 10% if corrected within the IRS correction window.
- Tax planning matters: Because RMDs are taxable income, the timing and amount of your distributions can affect your tax bracket, Medicare premiums (IRMAA), and Social Security taxation. Strategic planning around RMDs can make a meaningful difference in your overall tax picture.
Your first RMD must be taken by April 1 of the year following the year you reach your RMD age. All subsequent RMDs are due by December 31 each year. Keep in mind that delaying your first distribution may result in two taxable distributions in a single year.
Let us help you navigate your retirement distributions
An RMD calculator is a helpful starting point, but your financial picture is more than a single number. At Focal Point Financial Services, we help clients develop tax-efficient distribution strategies that align with their broader retirement goals.
Whether you're approaching your first RMD or looking to optimize your current withdrawal strategy, we're here to help.