What You Need to Know About Required Minimum Distributions

The IRS has enforced annual required minimum distributions, often referred to as RMDs, from many retirement accounts beginning at the age of 72. RMDs can be an important part of your retirement income strategy.

Here’s what you need to know about RMDs.

What to know:

An RMD is an IRS-mandated amount of money that you must withdraw from traditional IRAs or an employer-sponsored retirement account each year. It's important to understand when you need to take an RMD, how to avoid potentially costly penalties for late distributions, and maximize your withdrawal strategy.

When to start taking RMDs:

The IRS requires you to start taking RMDs at 72.*

How is the RMD calculated?

Generally, to calculate your RMD, start by listing the fair market value of your IRAs as of December 31 of the previous year. You'll need to calculate your RMD separately for each IRA you own. RMDs aren't required for Roth IRAs, so you don't have to include them in your calculations. You can use this calculator to help.

Account types:

  • RMDs must be taken out of tax-deferred retirement accounts, including:
  • Traditional IRAs
  • Rollover IRAs
  • SEPs
  • Most 401(k) and 403(b) plans
There are no RMDs for Roth IRAs unless they are inherited.


April 1 – Deadline for the first RMD in the year after you turn 72. You do not have to take an RMD from your workplace plan until you terminate or retire.

December 31 – Deadline for each following RMD.

Note that if you delay your first RMD until April, you'll have to take 2 RMDs your first year. The first will still have to be taken by April 1; the second, by December 31.


If you fail to withdraw a required distribution or fail to take enough, there’s a steep penalty. When you file your taxes, the amount not withdrawn is taxed at 50%.


The total amount of your RMD is taxed as ordinary income at your personal federal income tax rate. State and local taxes may also apply. If you've made a nondeductible IRA contribution, it will not be taxed. However, your earnings will be taxed provided you filed an IRS Form 8606. Learn more about IRS Form 8606 at www.irs.gov.

Keep in mind that this income increase may push you into a higher tax bracket and may impact the taxes you pay for your Social Security or Medicare.
Tax consequences for RMDs can be significant and seeking the support of a financial professional can be prudent, to ensure that the results align with your goals.

Pioneer and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction. 

* The change in the RMD age requirement from 70½ to 72 only applies to individuals who turn 70½ on or after January 1, 2020. Please speak with your tax advisor regarding the impact of this change on future RMDs.
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