RMD Calculator

Calculate your Required Minimum Distribution (RMD) for tax-deferred retirement accounts. Get instant results with future projections based on IRS life expectancy tables.

🧮 RMD Calculator

What is an RMD Calculator?

An RMD calculator is a financial tool that helps retirement account holders determine the minimum amount they must withdraw annually from tax-deferred retirement accounts like traditional IRAs, 401(k)s, and 403(b) plans. This calculator is essential because the IRS requires withdrawals starting at age 73, and failure to take the correct RMD results in a 25% penalty on the amount not withdrawn.

The tool uses your account balance as of December 31 of the previous year and divides it by an IRS life expectancy factor based on your age and beneficiary situation to calculate the required distribution amount. This ensures you comply with federal tax regulations while helping you plan your retirement income strategy.

Our RMD calculator also provides future projections if you enter an estimated rate of return, allowing you to see how your retirement account balance and required distributions may change over the next decade. This feature helps you make informed decisions about your retirement planning and tax strategies.

How to Use the RMD Calculator

Enter your year of birth to determine your current age and applicable RMD requirements.
Select the year for which you want to calculate the RMD (typically the current year or next year).
Input your total account balance as of December 31 of the previous year. This should include all tax-deferred retirement accounts subject to RMD rules.
Indicate whether your spouse is the primary beneficiary of your retirement account. If yes, provide your spouse's year of birth.
Optionally, enter an estimated annual rate of return to see future RMD projections for the next 10 years.
Click 'Calculate RMD' to see your required minimum distribution amount, distribution period, and optional future projections.

Latest Insights on RMDs

Starting in 2025, the SECURE Act 2.0 has increased the RMD starting age from 72 to 73 for individuals who turn 72 after December 31, 2022. This age will increase again to 75 in 2033, giving retirees more time to let their retirement savings grow tax-deferred.

The penalty for failing to take your full RMD has been reduced from 50% to 25% under SECURE Act 2.0. If you correct the mistake within a correction window, the penalty can be further reduced to 10%. However, it's still crucial to take your RMD on time to avoid any penalties.

Roth IRAs and Roth 401(k)s do not require RMDs during the original account owner's lifetime. However, starting in 2024, Roth 401(k) accounts are no longer subject to RMDs during the owner's lifetime, aligning them with Roth IRA rules. This makes Roth accounts an attractive option for estate planning.

If your spouse is more than 10 years younger than you and is the sole primary beneficiary of your retirement account, you can use the Joint Life and Last Survivor Expectancy Table, which results in a longer distribution period and smaller RMDs. This can help preserve more of your retirement savings.

You must calculate RMDs separately for each retirement account you own, but you can aggregate your IRA RMDs and take the total amount from one or more of your IRAs. However, 401(k) and other employer-sponsored plan RMDs must be taken separately from each account.

RMDs are taxed as ordinary income in the year they are withdrawn. This can potentially push you into a higher tax bracket, so it's important to plan your withdrawals strategically. Consider consulting with a tax professional to minimize your tax liability.

You can take your RMD as a lump sum or spread it throughout the year, as long as you withdraw the full required amount by December 31. For your first RMD, you have until April 1 of the year following the year you turn 73, but this means you'll have to take two RMDs in that year.

Setting up automatic withdrawals can help ensure you never miss an RMD deadline. Many financial institutions offer this service, which can provide peace of mind and help you avoid costly penalties. Consider scheduling monthly or quarterly distributions to spread out your tax liability throughout the year.

Understanding RMDs in Detail

What is a Required Minimum Distribution?

A Required Minimum Distribution (RMD) is the minimum amount you must withdraw from your tax-deferred retirement accounts each year once you reach a certain age. The IRS requires these withdrawals to ensure that the tax-deferred growth in these accounts is eventually taxed. RMDs apply to traditional IRAs, SEP IRAs, SIMPLE IRAs, 401(k)s, 403(b)s, 457(b)s, and other defined contribution plans. Roth IRAs are exempt from RMDs during the owner's lifetime.

When Do RMDs Start?

Under current law (SECURE Act 2.0), you must begin taking RMDs by April 1 of the year following the year you turn 73. For subsequent years, you must take your RMD by December 31. If you're still working at age 73 and don't own 5% or more of the company, you may be able to delay RMDs from your current employer's 401(k) plan until you retire. However, this exception doesn't apply to IRAs or 401(k)s from previous employers.

How Are RMDs Calculated?

RMDs are calculated by dividing your account balance as of December 31 of the previous year by a life expectancy factor from the IRS Uniform Lifetime Table. If your spouse is more than 10 years younger and is your sole beneficiary, you use the Joint Life and Last Survivor Expectancy Table instead, which results in a smaller RMD. The life expectancy factor decreases each year as you age, meaning your RMD amount will generally increase over time, even if your account balance remains stable.

What Are the Penalties for Missing RMDs?

If you fail to take your full RMD by the deadline, the IRS imposes an excise tax of 25% on the amount not withdrawn. This penalty was reduced from 50% under the SECURE Act 2.0. If you correct the shortfall within a correction window (generally two years), the penalty can be further reduced to 10%. To avoid penalties, it's crucial to calculate your RMD accurately and withdraw the required amount on time. If you miss an RMD, file Form 5329 with your tax return and consider requesting a waiver of the penalty if you have reasonable cause.

Special Cases and Exceptions

There are several special situations to be aware of: Inherited IRAs have different RMD rules depending on when the original owner died and your relationship to them. The SECURE Act eliminated the 'stretch IRA' for most non-spouse beneficiaries, requiring the account to be emptied within 10 years. Qualified Charitable Distributions (QCDs) allow you to donate up to $105,000 (in 2024) directly from your IRA to charity, which counts toward your RMD but isn't included in your taxable income. Still-working exception allows you to delay RMDs from your current employer's plan if you don't own 5% or more of the company.

Tax Implications of RMDs

RMDs are taxed as ordinary income at your marginal tax rate. This can have several implications: they may push you into a higher tax bracket, increase your Medicare Part B and Part D premiums through Income-Related Monthly Adjustment Amounts (IRMAA), affect the taxation of your Social Security benefits, and impact your eligibility for certain tax credits and deductions. Strategic planning can help minimize these effects, such as taking distributions early in retirement when you're in a lower tax bracket, converting traditional IRA funds to Roth IRAs before RMDs begin, or using QCDs to satisfy RMDs without increasing taxable income.

Best Practices for Managing RMDs

Calculate your RMD early in the year to avoid last-minute stress and ensure you have time to plan for the tax impact.
Consider taking distributions throughout the year rather than in a lump sum to spread out the tax liability and potentially avoid bracket creep.
Keep detailed records of all RMD calculations and withdrawals, including account statements and distribution confirmations.
Review your beneficiary designations regularly and update them as needed, as this can affect your RMD calculations and estate planning strategy.

Frequently Asked Questions

Do I need to take RMDs from all my retirement accounts?

You must calculate RMDs separately for each traditional IRA, 401(k), 403(b), and other tax-deferred retirement account. However, you can aggregate your IRA RMDs and withdraw the total from one or more IRAs. For 401(k)s and other employer plans, you must take the RMD from each account separately. Roth IRAs don't require RMDs during your lifetime, and as of 2024, neither do Roth 401(k)s.

What happens if I withdraw more than my RMD?

You can always withdraw more than your RMD, but the excess amount doesn't count toward future years' RMDs. Each year's RMD must be calculated and withdrawn separately. Withdrawing more than required can be a good strategy if you're in a lower tax bracket in a particular year or if you need the funds for expenses. However, remember that all withdrawals from traditional retirement accounts are taxed as ordinary income.

Can I reinvest my RMD?

Yes, you can reinvest your RMD in a taxable brokerage account, but you cannot roll it back into a tax-deferred retirement account like an IRA or 401(k). The RMD is considered a taxable distribution and must be included in your income for the year. If you don't need the money for living expenses, investing it in a taxable account allows it to continue growing, though future earnings will be subject to capital gains taxes rather than ordinary income tax rates.

How do RMDs work for inherited retirement accounts?

The rules for inherited retirement accounts depend on when the original owner died and your relationship to them. Spouses have the most flexibility and can treat the account as their own or take distributions based on their life expectancy. Non-spouse beneficiaries who inherited accounts after 2019 generally must empty the account within 10 years (the '10-year rule'), though there are exceptions for eligible designated beneficiaries such as minor children, disabled individuals, and those not more than 10 years younger than the deceased.

What is a Qualified Charitable Distribution (QCD)?

A Qualified Charitable Distribution allows you to donate up to $105,000 (in 2024) directly from your IRA to a qualified charity. The distribution counts toward your RMD but isn't included in your taxable income, which can provide significant tax benefits. You must be at least 70½ years old to make a QCD, and the donation must go directly from your IRA to the charity. This strategy is particularly valuable if you don't itemize deductions, as you still get the tax benefit of the charitable contribution.

Can I delay my first RMD until April 1 of the following year?

Yes, for your first RMD only, you have until April 1 of the year following the year you turn 73. However, this means you'll need to take two RMDs in that year—one by April 1 for the previous year and one by December 31 for the current year. Taking two RMDs in one year could push you into a higher tax bracket and increase your Medicare premiums, so many people choose to take their first RMD by December 31 of the year they turn 73 to avoid this situation.