Craig Wear, CFP®Craig Wear, CFP® | Expert in Roth Conversions & Tax-Efficient Retirement Strategies for IRA Millionaires

What are Required Minimum Distributions (RMDs for Retirement)

22 Sept 2024 · 1 min

Watch on YouTube

0:56

A short explainer (video/transcript) by Craig Wear, CFP® about required minimum distributions (RMDs) from retirement accounts, recent law changes affecting the RMD starting age, timing rules (deadline by April 1 of the year after the required age), and tax/penalty implications for failing to comply.

Questions this video answers

By April 1st of the year after you reach the required age (deadline to take the first RMD).

Age 73 for people who reach age 73 on or after January 1, 2024.

You may need to take two distributions in that calendar year (the one for the year you turned the age and the one for the current year).

Yes — taking money out of an IRA generally triggers income taxes.

Chapters

There's also not only discretionary distributions, but forced distributions is what I call it, which are those required minimum distributions. Required minimum distributions from these retirement accounts must begin by April 1st of the year in which you turn. For most people now age 73, if you wait till April, you have to take two distributions that year, because each year you have to do one. So the laws have changed recently with the the latest tax act. And so at age the age 73 requirement is if you reach age 73 on or after January 1st of 2024, then you have to begin RMDs by April 1st of the year after you turn 73. It's kind of important to follow the rules because the penalties are enormous. You don't want to end up there at all. Remember, the tax implications when you take money out of the IRA is that you pay taxes.