RMD Rules Explained: Start Ages, Divisors and Inherited IRAs
When required minimum distributions start, how the divisor works, aggregation rules across accounts, QCDs, penalties, and the 10-year rule for inherited IRAs.
When they start
Under SECURE 2.0, required minimum distributions begin at age 73, rising to 75 for those born in 1960 or later. The first distribution may be delayed to April 1 of the year after you turn the start age — but doing so stacks two RMDs into one tax year, which is rarely a good trade.
How the amount is computed
Divide the prior year's December 31 balance by the Uniform Lifetime Table divisor for your age. At 73 the divisor is 26.5, about 3.8% of the balance; by 85 it is 16.0, about 6.3%. The percentage rises every year, which is why RMD income grows faster than most people expect even in a flat market. A much more favorable joint table applies if your sole beneficiary is a spouse more than ten years younger.
Aggregation: what you can combine and what you cannot
- Multiple Traditional IRAs: compute separately, withdraw the total from any one of them.
- 401(k) and other employer plans: each plan's RMD must come from that plan.
- Roth IRAs have no owner RMDs; designated Roth 401(k) accounts no longer do either.
- Still working past the start age and not a 5% owner? Your current employer's plan may qualify for the still-working exception. IRAs never do.
Penalties
Missing an RMD triggers a 25% excise tax on the shortfall, reduced to 10% if corrected promptly within the correction window and reported on Form 5329. Requesting a waiver for reasonable cause is common and frequently granted.
QCDs: the most efficient way to give
From age 70½ you can send money directly from an IRA to a qualified charity. A qualified charitable distribution counts toward the RMD but never enters adjusted gross income, so it avoids the Social Security taxation drag, the IRMAA tiers and state tax at the same time — strictly better than taking the RMD and deducting a donation.
Inherited IRAs and the 10-year rule
- Spouses can treat the IRA as their own and use their own start age.
- Most non-spouse beneficiaries must fully empty the account by the end of the tenth year after death.
- If the owner had already begun RMDs, the beneficiary must also take annual distributions during years one through nine — the 10-year deadline does not replace them.
- Minor children, disabled or chronically ill beneficiaries, and those within ten years of the owner's age are eligible designated beneficiaries with more favorable stretch options.
Shrinking the problem before it starts
RMDs are computed from the pre-tax balance, so the only real lever is reducing that balance earlier — conversions during the low-income window, QCDs once eligible, and choosing which account funds spending each year.
Educational modeling only. Bracketwise is not tax, legal or investment advice.