Retirement & Income Planning
General: Required Minimum Distributions: A Higher Level Overview
This standalone video gives a high-level overview of required minimum distributions (RMDs), the amounts the IRS requires retirees to withdraw from tax-deferred accounts such as traditional IRAs and 401(k)s once they reach the applicable age. It explains why RMDs matter for retirement income and tax planning.
This standalone video gives a high-level overview of required minimum distributions (RMDs), the amounts the IRS requires retirees to withdraw from tax-deferred accounts such as traditional IRAs and 401(k)s once they reach the applicable age. It explains why RMDs matter for retirement income and tax planning.
Key takeaways
- RMDs are mandatory annual withdrawals the IRS requires from tax-deferred retirement accounts.
- They generally apply to traditional IRAs and 401(k)s, not Roth IRAs during the owner's lifetime.
- RMDs are taxed as ordinary income, so timing and account choices affect your tax bill.
- Missing or underpaying an RMD can trigger a significant IRS penalty.
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