Required Minimum Distributions (RMDs): When They Start and What Actually Changes

One of the most common retirement questions is simple: When do Required Minimum Distributions begin? The rule itself is not complicated. What people underestimate is how it changes the structure of retirement.

When Do RMDs Begin?

Under current law: If you were born between 1951 and 1959, your RMD age is 73.If you were born in 1960 or later, your RMD age is 75.

This applies to traditional IRAs, SEP IRAs, SIMPLE IRAs, and most employer retirement plans.

Roth IRAs do not require lifetime RMDs for the original owner.

That is the baseline.

(See IRC §401(a)(9); IRS Publication 590-B.)

Does the Month of My Birthday Matter?

No — Years ago, when RMDs began at age 70½, your exact birth month mattered. That rule is gone.

Now the only thing that matters is the calendar year you reach your required age. If you turn 73 on December 31, that entire year is still your first RMD year. The month does not change the obligation.

(See IRS Publication 590-B.)

The Required Beginning Date

Your first RMD is for the year you reach your RMD age. You are allowed to delay taking that first distribution until April 1 of the following year. That date is called your Required Beginning Date.

If you delay, you still owe the second RMD by December 31 of that same year. That means two RMDs in one calendar year. Many retirees do not realize this until their tax return is prepared.

That is where this stops being technical and starts being strategic.

(See IRS Publication 590-B.)

The First Year Decision

When you reach RMD age, you have two paths:

• You can take your first RMD in that same year.

Advantages: Income stays level across years.Less chance of stacking income.May limit bracket compression. Income levels may affect Medicare premiums. Keeps Roth conversion flexibility cleaner.

Tradeoff: You recognize income a year earlier.

• You can delay until April 1 of the following year.

Advantages: Temporary deferral.May help if that first year already has unusual income.

Tradeoffs: Two RMDs hit in one calendar year.Higher taxable income in that second year. Medicare premiums may respond. Conversion flexibility tightens.

Deferral does not eliminate income. It changes where it lands.

You Do Not Have to Take It in December

An RMD is an annual requirement. It is not required to be a single transaction.

If the amount is meaningful relative to your portfolio, taking it all at once introduces timing exposure.

Some retirees distribute monthly. Some quarterly. Some transfer shares instead of selling.

The rule sets a minimum annual amount. It does not dictate how you satisfy it.

(See IRS Publication 590-B.)

Can a Roth Conversion Satisfy an RMD?

No. If you owe an RMD for the year, that amount must be distributed first. It cannot be converted.

Only dollars above the required minimum can be converted to a Roth.

This rule is frequently misunderstood in retirement planning.

(See IRS Publication 590-B; IRC §402(c)(4)(B).)

Can You Roll an RMD Into Another IRA?

No. An RMD is not an eligible rollover distribution.

Once it leaves the account, it cannot go back into a qualified plan or IRA.

(See IRC §402(c)(4)(B); IRS Publication 590-B.)

Do Qualified Charitable Distributions Count?

Yes, if done correctly. A Qualified Charitable Distribution from an IRA can satisfy part or all of your annual RMD and is excluded from taxable income, subject to eligibility rules and limits. It is one of the few tools that both satisfies the requirement and reduces taxable income.

We will cover QCDs separately because they deserve careful explanation.

(See IRC §408(d)(8); IRS Publication 590-B.)

What About Employer Plans?

If you are still working and do not own more than 5 percent of the company, and the plan allows it, RMDs from that employer plan may be delayed until retirement.

That exception does not apply to traditional IRAs.

(See IRS Required Minimum Distribution FAQs.)

What About Inherited IRAs?-

Inherited IRAs follow different rules. Most non spouse beneficiaries must generally distribute the account within 10 years of the original owner’s death. In certain cases, annual RMDs may apply within that window.

Spouses have additional flexibility and may be able to treat the account as their own.

We will cover inherited IRAs in detail separately because the rules are more nuanced than most people expect.

(See IRC §401(a)(9)(H); IRS Publication 590-B; Final Regulations under the SECURE Act.)

Do Non-qualified Annuities Have RMDs?

Non-qualified annuities funded with after-tax dollars do not have lifetime RMDs.

Annuities held inside IRAs do.

Those are two very different things, and they are often confused.

(See IRS Publication 575; IRS Publication 590-B.)

What About QLACs?

Qualified Longevity Annuity Contracts allow a portion of IRA assets to be excluded from RMD calculations until later ages, subject to regulatory limits.

They do not eliminate RMDs. They adjust timing.

(See Treasury Regulations §1.401(a)(9)-6.)

What Actually Changes When RMDs Begin?

The calculation itself is formula-based. What changes is control.

Once RMDs begin:

You no longer fully control income timing.Income levels can affect Medicare premiums.Roth conversion flexibility narrows.Tax coordination becomes more important.

The rule itself is straightforward. What builds over time are the secondary effects.

The Better Question

Instead of asking only when RMDs start, a better question is:

In which year — and in what pattern — do I want this income recognized?

Because once required distributions begin, flexibility decreases. -And in retirement, flexibility often matters more than short-term deferral.

A Final Thought

If you have an RMD coming up, the rule itself is straightforward. The timing decisions are not.

Our clients rely on us to coordinate required distributions with Roth conversions, Medicare planning, charitable giving, and long-term tax strategy.

You do not have to navigate those decisions alone.

If you are approaching RMD age or already taking distributions, schedule a meeting, and we will walk through it together.

Sources:

This article is based on current federal tax law and publicly available guidance, including:

Internal Revenue Code §401(a)(9)Internal Revenue Code §402(c)(4)(B)Internal Revenue Code §408(d)(8)

Treasury Regulations under IRC §401(a)(9)https://www.ecfr.gov/current/title-26/section-1.401(a)(9)-6

IRS Publication 590-B, Distributions from Individual Retirement Arrangements (IRAs)https://www.irs.gov/publications/p590b

IRS Publication 575, Pension and Annuity Incomehttps://www.irs.gov/publications/p575

IRS Required Minimum Distribution FAQshttps://www.irs.gov/retirement-plans/retirement-plan-and-ira-required-minimum-distributions-faqs

Final regulations issued under the SECURE Act and SECURE 2.0 Act.

Readers should consult primary IRS sources or a qualified professional for updated guidance, as rules may change.

Disclosure

This article is for informational purposes only and should not be construed as individualized tax, investment, or legal advice. RMD rules vary based on birth year, account type, beneficiary status, and individual circumstances.