Required Minimum Distribution (RMD)
An annual withdrawal the IRS forces on pretax retirement accounts starting at age 73. Roth IRAs and, since 2024, Roth 401(k)s are exempt.
SECURE 2.0 pushed the RMD start age to 73 (and to 75 for people born 1960 or later). The amount is calculated using your Dec 31 prior-year balance divided by an IRS life-expectancy factor. First RMD can be delayed to April 1 of the year after you turn 73, but that means two RMDs in the same year, which often pushes you into a higher bracket. Penalty for missing an RMD is 25% of the shortfall (reduced from 50% by SECURE 2.0).
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