IRS Required Minimum Distribution (RMD) Calculator
Understanding Your Required Minimum Distribution (RMD)
A Required Minimum Distribution (RMD) is the smallest amount that the IRS mandates you must withdraw from your retirement accounts annually. These rules primarily apply to traditional IRAs, SEP IRAs, SIMPLE IRAs, and employer-sponsored plans like 401(k) and 403(b) accounts.
New SECURE Act 2.0 Rules
The starting age for RMDs has recently changed. Under the SECURE Act 2.0:
- If you turned 72 in 2022 or earlier, your RMD age was 72.
- If you turn 73 between 2023 and 2032, your RMD age is 73.
- If you turn 74 in 2033 or later (born in 1960 or later), your RMD age will be 75.
How the RMD is Calculated
The calculation uses the IRS Uniform Lifetime Table. The formula is straightforward:
Realistic Calculation Examples
Example 1: John is 75 years old and had $400,000 in his Traditional IRA on December 31st of last year. According to the IRS Uniform Lifetime Table, the divisor for age 75 is 24.6.
$400,000 ÷ 24.6 = $16,260.16 (Annual RMD)
Example 2: Sarah is 80 years old with an account balance of $250,000. The divisor for age 80 is 20.2.
$250,000 ÷ 20.2 = $12,376.24 (Annual RMD)
Common Questions
What happens if I don't take my RMD?
The penalty for failing to take an RMD is severe. Historically it was 50%, but under SECURE 2.0, it has been reduced to 25%, and potentially 10% if corrected in a timely manner.
Do Roth IRAs have RMDs?
Original owners of Roth IRAs are not required to take RMDs during their lifetime. However, beneficiaries of inherited Roth IRAs may be subject to distribution rules.