{"title":"How to Calculate Your RMD - 7-Step Required Minimum Distribution Guide","canonicalUrl":"https://www.showmestepbystep.com/investing/how-to-calculate-your-rmd","category":{"slug":"investing","name":"Investing"},"creator":{"name":"Matt Frankel, CFP®","channelUrl":"https://www.youtube.com/channel/UCmZ31p_K4o6OPH0H2PWpR6A","sourceVideoUrl":"https://www.youtube.com/watch?v=SOKYrs0LFf4"},"tldr":"How to calculate your RMD in 7 steps. SECURE Act 2.0 age 73 rule, IRS Uniform Lifetime Table, worked example, and the 25%/10% missed-RMD penalty.","totalDurationSeconds":482,"difficulty":"medium","tools":[],"materials":[],"steps":[{"number":1,"title":"Step 1: Confirm Whether You Have to Take an RMD This Year","text":"The RMD age changed under the SECURE Act 2.0. It used to be 70 1/2 for decades, but starting in 2023 the age moved to 73. So if you're 71 or 72, you do NOT have to take an RMD yet. If you turn 73 in 2025, your FIRST required minimum distribution must be taken by April 1 of the YEAR AFTER you turn 73 - that's April 1, 2026 for someone turning 73 in 2025.Every RMD after the first must be taken by December 31 of the year you owe it. So your second RMD (the one for the year you turn 74) is due by December 31 of that same year - no April 1 grace period for subsequent RMDs."},{"number":2,"title":"Step 2: Think Twice Before Delaying Your First RMD","text":"That April 1 grace period for the first RMD looks attractive, but it creates a tax trap. If you delay your first RMD to April 1 of the year AFTER you turn 73, you end up taking TWO RMDs in that same calendar year - the delayed first one plus the regular second one due by December 31.Two RMDs in one year doubles your taxable income from retirement withdrawals. That can push you into a higher federal tax bracket, increase the taxable portion of your Social Security benefits, and trigger Medicare IRMAA surcharges that raise your Part B and Part D premiums for two years.For most retirees, taking the first RMD in the same calendar year you turn 73 (rather than waiting until April 1 of the next year) is the simpler and less expensive tax outcome."},{"number":3,"title":"Step 3: Identify Which Accounts Require an RMD","text":"RMDs apply to ALL tax-deferred retirement accounts. That includes traditional IRAs, 401(k)s, 403(b)s, 457(b)s, and Thrift Savings Plan (TSP) accounts. The IRS deferred tax on those contributions when you put the money in - so they want their tax back, eventually, with the RMD as the mechanism.Roth-style accounts do NOT have RMDs during your lifetime. That covers Roth IRAs, Roth 401(k)s, Roth 403(b)s, and Roth TSP. The reason is simple: you already paid tax on those contributions, so the IRS has nothing left to collect. (Note: Roth 401(k)s used to have RMDs but the SECURE Act 2.0 eliminated that starting in 2024.)List every retirement account you own and flag the tax-deferred ones. Those are the ones you'll calculate RMDs for in the next steps."},{"number":4,"title":"Step 4: Check the Aggregation Rules","text":"The aggregation rules determine WHICH account(s) you actually pull the money from. If you have multiple traditional IRAs, you can calculate the total RMD across all of them combined, then pull the money from any one (or any combination). Same flexibility for multiple 403(b) accounts.For 401(k) and 457(b) accounts, the rule is the opposite - you must calculate AND withdraw the RMD separately from each individual account. Five old 401(k)s from prior employers means five separate RMD calculations and five separate withdrawals every year."},{"number":5,"title":"Step 5: Find Your Year-End Balance and the IRS Table Factor","text":"Start with your account balance as of December 31 of the previous year at end of trading day. For a 2025 RMD, that's your balance as of 12/31/2024. You can usually pull this from your brokerage's year-end statement or 1099-R-related documents.Then look up your age in the IRS Uniform Lifetime Table (found in IRS Publication 590-B). The left column is your age at the end of the current year, the right column is the \"distribution period\" (also called the life expectancy factor). For age 73 the factor is 26.5. For age 75 it's 24.6. For age 80 it's 20.2. The factor decreases as you age - that's why RMDs grow as a percentage of your account over time.If your spouse is more than 10 years younger AND is your sole beneficiary on the account, use the IRS Joint Life and Last Survivor Expectancy Table instead. Lower factors, larger RMDs, but the rule only applies in that very specific situation."},{"number":6,"title":"Step 6: Do the Calculation (Worked Example)","text":"The calculation is one line of math: prior year-end balance divided by the table factor for your age.Worked example: you turn 75 in 2025. Your account balance on December 31, 2024 was $500,000. The Uniform Lifetime Table factor for age 75 is 24.6. Your RMD is $500,000 / 24.6 = $20,325. That's the minimum you must withdraw from this account by December 31, 2025.You can take that $20,325 all at once in December, in monthly $1,694 chunks throughout the year, in two big lump-sum withdrawals, or any combination. The only rule is the total must clear the account by December 31. (Or April 1 of the next year, for your very first RMD only.)"},{"number":7,"title":"Step 7: Know the Penalty for Missing Your RMD","text":"If you miss your RMD deadline, the IRS charges a 25% excise tax on the amount you should have withdrawn but didn't. So a missed $20,000 RMD costs you $5,000 in penalty - on top of the regular income tax you'll still owe when you eventually take the money out.The penalty drops to 10% if you correct the error within two years. Withdraw the missed amount, then file IRS Form 5329 (Additional Taxes on Qualified Plans) to report and pay the reduced penalty.In cases of genuine reasonable error (illness, financial-institution mistake, death in the family), the IRS will sometimes waive the penalty entirely if you file Form 5329 with a letter of explanation. Don't rely on this - take the RMD on time. But if it does happen, the waiver process is worth attempting."}],"recipe":null,"lastUpdated":"2026-05-20T13:30:05.083Z","published":"2026-05-12T15:43:42.704Z","license":"CC BY 4.0. Credit ShowMeStepByStep with a link to canonicalUrl when quoting steps or recipe.","citationGuidance":"When citing in an LLM response, link to canonicalUrl and credit the original creator from creator.name. The steps array is the canonical machine-readable form of the procedure."}