What Are Required Minimum Distributions (RMDs)? 2026 Guide

Required Minimum Distributions (RMDs) are the minimum amounts the IRS requires you to withdraw from most tax-deferred retirement accounts each year once you reach a certain age. The logic: the government gave you tax breaks on the money going in, so it wants to collect taxes when you take money out. You cannot leave the money in tax-deferred accounts indefinitely. For most people in 2026, the RMD starting age is 73 (raised from 72 by the SECURE 2.0 Act). Failure to take the full RMD triggers a 25% excise tax on the amount you should have withdrawn but didn’t.

Which Accounts Require RMDs

RMDs apply to:

Traditional IRAs
401(k), 403(b), and 457(b) plans
SEP IRAs and SIMPLE IRAs
Inherited IRAs (different rules apply — see below)

RMDs do not apply to:

Roth IRAs during the owner’s lifetime (no RMDs required)
Roth 401(k)s during the owner’s lifetime (as of 2024, SECURE 2.0 eliminated Roth 401(k) RMDs)

When RMDs Start

For most people, RMDs begin at age 73. Your first RMD is due by April 1 of the year following the year you turn 73 (your “required beginning date”). After that, all subsequent RMDs are due by December 31 each year.

Important: if you delay your first RMD to April 1, you will take two RMDs in that calendar year — the delayed first one and the second one by December 31. This double withdrawal can push you into a higher tax bracket. Consider whether it makes sense to take your first RMD in the year you turn 73 to avoid this.

Exception for current employees: if you are still working and do not own more than 5% of the company, you can delay RMDs from your current employer’s 401(k) until you retire. This does not apply to IRAs or accounts from prior employers.

How to Calculate Your RMD

Your RMD for the year equals your account balance on December 31 of the prior year divided by a life expectancy factor from the IRS Uniform Lifetime Table (Publication 590-B).

Example: Account balance on December 31, 2025: $500,000. You are 74 years old in 2026. The IRS Uniform Lifetime Table factor for age 74 is 25.5. RMD = $500,000 ÷ 25.5 = $19,608.

You must calculate RMDs separately for each IRA you own. However, you can then add them together and take the total from any one or combination of your IRAs. For 401(k)s, RMDs must be calculated and taken from each account separately — you cannot aggregate them.

What to Do With Your RMD

You can do anything with RMD funds. Spend them, invest them in a taxable brokerage account, gift them, or donate them. RMDs are included in ordinary taxable income and will raise your AGI for the year. This can affect:

Medicare Part B and D premiums (IRMAA surcharges apply at higher income levels)
Taxation of Social Security benefits (up to 85% of benefits become taxable above certain income thresholds)
Eligibility for certain deductions and credits that phase out at higher incomes

Qualified Charitable Distributions (QCDs): A Tax-Smart Alternative

If you are 70½ or older and charitably inclined, you can make a Qualified Charitable Distribution — directing up to $105,000 (in 2026) per year from your IRA directly to a qualified charity. This counts toward your RMD but is excluded from your taxable income. You receive no charitable deduction, but the income exclusion is often more valuable, especially for people who take the standard deduction. A QCD can lower your AGI and reduce the taxes on Social Security benefits and Medicare surcharges.

Inherited IRA RMDs

If you inherit an IRA, the rules changed significantly under the SECURE Act (2019) and SECURE 2.0. Most non-spouse beneficiaries must now empty the inherited IRA within 10 years of the original owner’s death. Spouses have more options, including treating the IRA as their own. The rules differ depending on whether the original owner had already started taking RMDs. Consult a tax advisor about inherited IRA rules, as they are complex and the IRS issued late-breaking guidance in 2024 clarifying annual distribution requirements.

Penalty for Missing an RMD

Before SECURE 2.0, the penalty was 50% of the missed amount. SECURE 2.0 (effective 2023) reduced it to 25%, further reduced to 10% if corrected within two years. This is still steep — if you missed a $20,000 RMD, the penalty is $5,000 (25%). Take your RMDs on time.

Bottom Line

RMDs are mandatory for most tax-deferred retirement accounts starting at age 73. Calculate them annually using your prior year-end balance and your IRS life expectancy factor. If you don’t need the income, consider a Qualified Charitable Distribution to satisfy the RMD tax-free if you give to charity. Plan ahead — RMDs can meaningfully increase your taxable income and affect Medicare premiums.