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The required minimum distribution (RMD) rules are intended to prevent taxpayers from accumulating tax-deferred retirement savings in tax-qualified retirement plans and individual retirement accounts (IRAs) indefinitely. The SECURE Act and SECURE 2.0 Act changed the RMD ages.
If you are approaching RMD age at this time, you will need to navigate a potentially tricky transition period:
- If you attained age 72 in 2022 (you were born in 1950), you were required to take your first RMD by April 1, 2023 (your required beginning date or RBD)
- If you attained age 72 in 2023 (you were born in 1951), you could skip 2023, and your RBD is April 1, 2025
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If you attain age 73 in 2025 (you were born in 1952), your RBD is April 1, 2026
- Thereafter, your RBD will be April 1 of the year following your attainment of age 73, or attainment of age 75 if you were born after 1959.
If you take your first RMD in the year of your RBD, you will need to take a second RMD during that same year. For example, if you take your initial, 2024 RMD during 2025 by your RBD of April 1, 2025, you will have to take your 2025 RMD by December 31, 2025.
While the RMD rules also apply to IRAs, there are some important differences between qualified plans and IRAs. RMD amounts need to be calculated separately for each qualified retirement plan. By contrast, a taxpayer who has multiple IRAs can aggregate the balances in all of their IRAs and withdraw the total RMD amount from any one or more of the IRAs. Another important difference is that in the case of a qualified retirement plan, no RMD is required for a non-owner employee until after the employee terminates employment. This rule does NOT apply to IRAs.
To summarize, the RMD ages as amended by the SECURE Act and SECURE 2.0 are:
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