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RMDs by age: Understanding how distributions change as you get older

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For many retirement accounts, the Internal Revenue Service (IRS) requires you to withdraw a certain amount of funds from your savings each year. This is what's known as your required minimum distribution (RMD).

Not every type of retirement account mandates that account holders take RMDs annually. However, those that do require it have rules that change with age—and penalties if those guidelines aren't followed.

Here's what you need to know about the requirements for RMDs by age, including how to calculate your RMDs and avoid penalties.

What is a required minimum distribution?

A required minimum distribution is a rule that requires you to withdraw a minimum amount from tax-qualified retirement plans once you reach a certain age. Until recently, you had to start taking RMDs at age 70½. However, in 2020, the passage of the Setting Every Community Up for Retirement Enhancement (SECURE) Act increased that age to 72.

The IRS mandates RMDs from most, but not all, retirement accounts. If you have any of the following retirement savings accounts, you're subject to RMD regulations:

  • Traditional individual retirement accounts (IRAs)
  • Simplified Employee Pension (SEP) IRAs
  • Savings Incentive Match Plan for Employees (SIMPLE) IRAs
  • Beneficiary IRAs (non-spouse beneficiaries of Roth IRAs)
  • 401(k) plans including Roth 401(k)
  • 403(b) plans
  • 457(b) plans
  • Profit-sharing plans
  • Other defined contribution plans

If you have a Roth IRA, you don't need to comply with RMD rules. These accounts don't require withdrawals, because you use after-tax dollars to contribute to them.

You can use your distributions any way you like—to use as income, to donate to charity or to cover other expenses. You can't reinvest your RMD funds into a 401(k) or IRA, but you can put the money into savings or a (taxable) brokerage account.

Your RMDs are taxed at your current income level. Because you contribute pretax dollars to these savings accounts, the IRS wants to make sure you pay your deferred taxes on them. Consider exploring how you can plan for taxes in retirement with a financial advisor.

Do RMDs increase with age?

Whether or not RMDs increase by age is dependent on several factors, they can increase but are ultimately based on account balances, life expectancy and age. Once you begin withdrawing your RMDs, you'll find that the exact amount changes yearly. That's due to the life expectancy portion of the calculation, which is called your life expectancy factor or distribution period. As you age, your factor decreases, and your RMDs may grow as you get older.

To calculate your personal RMD, you must use the Uniform Lifetime Table. But note that there a few exceptions below.

Uniform Lifetime Table. This table is used for everyone. The only exception for any account holder who has a spouse more than 10 years younger than them. In this case, the Joint Life table is used. The table is based on actuarial calculations. These tables are in effect as of January 1, 2022. Therefore, previous tables won't be accurate for running calculations. See the most recent chart below.

Age
Distribution Period (in years)
Age (Cont.)
Distribution Period Cont. (in years)
72
27.4
97
7.8
73
26.5
98
7.3
74
25.5
99
6.8
75
24.6
100
6.4
76
23.7
101
6
77
22.9
102
5.6
78
22
103
5.2
79
21.1
104
4.9
80
20.2
105
4.6
81
19.4
106
4.3
82
18.5
107
4.1
83
17.7
108
3.9
84
16.8
109
3.7
85
16
110
3.5
86
15.2
111
3.4
87
14.4
112
3.3
88
13.7
113
3.1
89
12.9
114
3
90
12.2
115
2.9
91
11.5
116
2.8
92
10.8
117
2.7
93
10.1
118
2.5
94
9.5
119
2.3
95
8.9
120 and over
2
96
8.4
 
 

Exceptions for the Uniform Lifetime Table

  • Table I (Single Life Expectancy). If you are the beneficiary of an IRA and aren't the spouse of the IRA owner, see the Single Life Expectancy Table.
  • Table II (Joint Life and Last Survivor Expectancy). If you have a spouse 10 years younger than you and are the IRA's sole beneficiary, see the Joint Life and Last Survivor Table.

If you inherited an IRA, you may still need to take RMDs if the original account holder needed to take the distribution but hadn't. For the year the owner passed, you'll use the RMD the owner would have had to withdraw. After that, distribution under the SECURE Act rules may depend on the date of their passing.

How are RMDs calculated?

Your RMD is the result of a relatively straightforward formula. First, take your prior year's qualifying IRA and retirement plan balances, and add them up. Then, divide that number by your life expectancy factor from your required table the IRS provides found above. The number is your RMD for that year. You will need to group like account types (IRAs, 403[b]s together) 401(k) is calculated separate from that group and take distributions from each independently to satisfy the requirement properly.

Here are a few examples of how RMDs might change with age*:

  • Say you turned 73 in 2022 and your total qualified retirement account balances on December 31, 2021 were $750,000. You're married with a spouse only a year younger, so you use the standard Uniform Lifetime Table. Your factor is 26.5. To find your RMD, divide $750,000 by 26.5 to get $28,302. That's the amount you must withdraw by December 31, 2022 to avoid penalties from the IRS.
  • Your marital status and retirement account balances are the same as above, except now, you turned 80 in 2022. You'll use the same table in this case, but your factor is 20.2. So, you'll divide $750,000 (your total qualifying retirement amount balances at the end of 2021) by 20.2. Here, your mandatory withdrawal is $37,129.

  • The factor decreased because your age increased, which caused your RMD to increase.
  • If you have a spouse younger than you by 10 years or more, then you'll use Table II and find the factor at the intersection of your ages. Then, use that factor in the calculation instead. For example, if you turned 73 in 2022 and your spouse turned 60, your factor from Table II is 28.6 (vs. 26.5). That's slightly higher than the factor for people who are married to a spouse closer in age, so the RMD would be slightly smaller at $26,224 because of the age gap.

Important dates to remember for RMDs

There are a few important dates to remember before running the numbers:

  • RMDs begin the year you attain age 72. However, if you turned 70½ before Jan. 1, 2020, then you must follow the previous rule.
  • December 31. Your RMD calculations are based on the total amounts in your retirement savings accounts (not including your Roth IRA) as of December 31 the previous year.
  • April 1. You must withdraw your first RMD by April 1 after the year you turn 72. You'll only have to remember this date once. After that, you must withdraw your RMDs by December 31 each year.

For example*: If you turn 72 in October 2022, you have until April 1, 2023 to withdraw your first RMD (based on the total balance of your December 31, 2021 retirement account values). After that, you must take any subsequent RMDs by December 31 of that year. For 2023, you must withdraw your RMDs by December 31, 2023 based on your 2022 account values.

One last thing to consider, especially during the first year you're required to take RMDs, is how the timing of your withdrawals can impact your taxes. If you wait until April 1 the year after you turn 72, you may have to pay taxes on two RMDs—the one you took in April and the one you have to take by December 31. Consult with a financial advisor or tax professional to determine the best way to handle this situation.

What happens if I don't take my RMDs?

Unfortunately, if you don't take your RMDs, the IRS will levy a penalty that amounts to 50% of the amount you were supposed to withdraw. That penalty is on top of the taxes you owe for your required withdrawal.

For example*, if your RMD is $20,000 and you only take $10,000, the IRS will tax you for the total required amount of $20,000. You'll also face a 50% tax on the $10,000 you didn't take, meaning you will owe the IRS an additional $5,000.

Sometimes, you may realize you made a mistake calculating your RMD or got confused about the dates and missed a deadline. If that's the case, you can ask the IRS to waive the penalties. To ask for a penalty waiver on your RMDs, fill out Form 5329 and attach a letter explaining what happened and what you've done to fix your mistake.

Another option is to get your RMDs automatically calculated and withdrawn. Many custodians can do that for you, or you can ask a financial professional about your options for automating the process.

How the SECURE Act changed RMD rules

The SECURE Act went into effect in January 2020. The act aims to increase the number of Americans saving for retirement and help them build assets. Among other changes to the tax code, it moved the RMD age from 70½ to 72.

This change stems in part from the fact that people are living longer and spending more time enjoying retirement. Gaining a few years of savings can help extend retirement incomes for many.

As of 2022, the SECURE Act 2.0 is moving its way through Congress. A bill has already passed the House of Representatives, and the Senate is working on another version. If passed, the bill could gradually increase RMDs by age over time until 75, reduce the penalty on nonwithdrawals to 25% and waive RMDs for those with less than $100,000 in their qualifying retirement accounts. The Secure Act 2.0 has not become law, but it's something to watch over the next few years.

The bottom line

You have plenty of things to plan for as you enter retirement. Working with a local financial advisor can help you develop a strategy for your retirement planning needs, including navigating the rules and regulations around required minimum distributions.

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* Hypothetical examples are for illustrative purposes. May not be representative of actual results.

Thrivent and its financial advisors and professionals do not provide legal, accounting or tax advice. Consult your attorney or tax professional.
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