RMD Calculator

Required Minimum Distributions (RMDs) are mandatory withdrawals from retirement accounts that begin at age 73. The IRS requires these to ensure taxes are eventually paid on tax-deferred retirement savings.

RMD Rules

• Starting Age: Age 73 (changed from 72 in 2023)
• Deadline: December 31 each year
• First RMD: Can be delayed until April 1 of following year
• Penalty: 25% of amount not withdrawn (reduced from 50%)

Accounts Subject to RMDs

• Traditional IRAs
• 401(k), 403(b), and 457 plans
• Traditional TSP accounts
• SEP-IRAs and SIMPLE IRAs
• Exempt: Roth IRAs (during owner's lifetime)

RMD Calculation Method

• Use account balance from December 31 of prior year
• Divide by life expectancy factor from IRS tables
• Most people use Uniform Lifetime Table
• Surviving spouses may use Joint Life Table

RMD Strategies

• Take distributions early in the year for investment flexibility
• Consider Qualified Charitable Distributions (QCDs)
• Coordinate with other income to manage tax brackets
• Reinvest RMDs in taxable accounts if not needed
• Consider Roth conversions before RMDs begin

Tax Planning

• RMDs are taxed as ordinary income
• May push you into higher tax bracket
• Can affect Medicare premiums (IRMAA)
• May impact Social Security taxation
• Consider tax-loss harvesting to offset gains