Required Minimum Distributions (RMDs): Complete Guide

Required Minimum Distributions (RMDs) are mandatory annual withdrawals from traditional IRAs and 401(k)s starting at age 73 (SECURE 2.0 Act). The RMD amount is calculated by dividing your account balance by your life expectancy factor from IRS tables.

For a $500,000 IRA at age 73, the RMD is approximately $18,868 (using the 26.5 factor). Failing to take your RMD results in a 25% excise tax on the amount not withdrawn.

Roth IRAs have no RMDs during the owner's lifetime. Roth 401(k)s no longer have RMDs starting in 2024..