Retirement Account Information

Required Minimum Distributions Guide IRA Withdrawals

When you reach a certain age, the IRS requires you to take money from your employer-sponsored retirement plan, most IRAs, or both if you have them. These withdrawals are called required minimum distributions. The current requirement is that when you reach age 70½, you generally must begin making withdrawals from these accounts according to specific guidelines.

The required minimum distribution rule applies to traditional, Rollover, SEP-, SARSEP- and SIMPLE-IRAs. You do not have to take a required minimum distribution from a Roth IRA at any age.

When to Take Distributions

You must take your first distribution by April 1 of the year after you reach age 70½. If you take your first distribution between January 1 and April 1 of that year, you must take your next distribution on or before December 31 of the same year. For each year that follows, you must take your minimum distribution on or before December 31.

If you did not previously pay income taxes on any portion of your distribution – such as earnings or deductible contributions – you will owe ordinary income taxes on that portion in the year you receive a distribution.

Calculating Distributions

Your required minimum distribution will be calculated based on your life expectancy, beginning at age 70, and the life expectancy of a beneficiary. The beneficiary will be considered to be 10 years younger than you, regardless of actual age. This joint life expectancy will be used even if you have not named a beneficiary and will be recalculated from IRS tables each year.

However, if your spouse is your sole beneficiary and is more than 10 years younger than you, the IRS allows you to use your actual joint life expectancy. This will result in lower required minimum distributions.

As the name indicates, your required minimum distribution must reach a minimum amount. The IRS rules are specific and strict. If you do not take (at least) your required minimum distribution, you'll be subject to a 50% penalty on the amount you did not take.

Distributions After Death

Required minimum distributions from your IRA after your death are based on who you name as beneficiary and your date of death:

• If you die before April 1 of the year after you reach age 70½, the beneficiary's required minimum distributions would be calculated using his or her life expectancy.


• If you die on or after April 1 of the year after you reach age 70½, the beneficiary's required minimum distributions would be calculated using the longer of his or her life expectancy or your life expectancy based on your age at death. This allows a beneficiary who is older than you to use your life expectancy, which would result in smaller minimum distributions.