If you turned 73 this year and have money sitting in a traditional IRA or 401(k), the IRS expects its cut.
That's the Required Minimum Distribution, or RMD — and the rules around it shifted again in a way plenty of people are still catching up on.
The SECURE 2.0 Act pushed the starting age to 73 for most people, and it climbs to 75 in 2033.
If you hit 73 in 2024 or later, you're in the first wave under the new threshold.
Miss a withdrawal and the penalty is steep: 25% of what you should have taken, dropping to 10% if you fix it fast.
The part that trips people up is the math.
Your RMD isn't a flat percentage — it's based on your account balance at the end of the prior year divided by a life expectancy factor the IRS publishes.
That means a rough market year can shrink your balance and your required withdrawal along with it, but a strong year can push the number up.
You can't just take it all in January and forget it, either.
You're allowed to take your full RMD in one lump or spread it across the year, as long as the total comes out by December 31.
One exception: your very first RMD can be delayed until April 1 of the following year.
Do that, though, and you'll stack two taxable withdrawals into the same tax year — a classic way to accidentally bump yourself into a higher bracket.
Where people really get burned is with multiple accounts.
If you hold several traditional IRAs, you can total up the RMDs and pull the entire amount from just one of them.
But 401(k)s and 403(b)s don't play by that rule.
Each workplace plan generally needs its own separate withdrawal.
Mixing those up is a common and expensive mistake.
Roth IRAs have no RMD during the owner's lifetime, which is a big reason they're popular for estate planning.
But Roth 401(k)s used to require withdrawals — and under the newer rules, that requirement is gone starting in 2024.
If you moved money or rolled a Roth 401(k) recently, it's worth confirming your plan actually updated its paperwork.
A quieter strategy people are using is the qualified charitable distribution, or QCD.
Once you're 70½, you can send up to $105,000 per year directly from an IRA to a charity.
It counts toward your RMD and keeps the money out of your taxable income entirely — something a regular charitable deduction can't always do if you take the standard deduction.
If you inherit an IRA, the clock works differently.
Most non-spouse beneficiaries now have to empty the account within 10 years, and the IRS has been phasing in penalties for missed annual withdrawals during that window.
This is one area where a single misread of the rules can cost thousands, so it's worth a conversation with a tax professional rather than a guess.
The simplest defense is a calendar reminder set for early in the year, not December.
Give yourself time to calculate the number, decide which accounts to pull from, and check whether a QCD makes sense.
Waiting until the last week of the year is how people end up with penalties they never saw coming. **Our take:** RMDs aren't a tax trap so much as a deadline people ignore until it's too late.
The rules are genuinely more forgiving than they were a few years ago — but only if you actually know which version applies to you.
Final Thoughts
Spend twenty minutes with your account statements now, and you'll likely save yourself a very unpleasant letter later.