Required minimum distributions from many retirement savings plans and individual retirement accounts must usually be taken by Dec. 31.
Required minimum distributions (RMDs) generally are minimum amounts that retirement plan account owners must withdraw annually starting with the year they reach 72 or, if later, the year they retire.
Individuals who reached 70 ½ in 2019, (70th birthday was June 30, 2019 or earlier) did not have an RMD due for 2020, but will have to take one by Dec. 31, 2021.
Individuals who reach 72 in 2021 (and their 70th birthday was July 1, 2019 or later) have their first RMD due by April 1, 2022.
In general, the required distribution rules apply to:
- Owners of traditional Individual Retirement Arrangements (IRAs)
- Owners of traditional Simplified Employee Pension (SEP) IRAs
- Owners of Savings Incentive Match Plans for Employees (SIMPLE) IRAs
- Participants in various workplace retirement plans, including 401(k), Roth 401(k), 403(b) and 457(b) plans
Roth IRAs do not require distributions while the original owner is alive.
The RMD is based on the taxpayer’s life expectancy and their account balance. For most taxpayers, life expectancy used to calculate the RMD is based on Uniform Lifetime Table III in Publication 590-B, Distributions from IRAs. Individuals can use online worksheets from the IRS.
SEE ALSO: New IRS Life Expectancy Tables Will Impact Many Federal Employees and Retirees on Jan. 1, 2022
Additional Resources for RMDs
The rules for RMDs can be complex, so it’s important to review the official information such as those listed below: