Skip to main content

If you’re one of those investors who still needs to take this year’s required minimum distributions (RMDs) or someone looking ahead to taking them in upcoming years, the following tips may help you develop a practical strategy.

The first distribution for tax-advantaged retirement accounts is required the year you turn 70 ½. (There are no RMDs on Roth IRAs during the owner’s life.) The actual deadline is April 1 of the following year. But keep in mind the deadline for all subsequent years will be Dec. 31, so consider tax ramifications of taking two distributions in one calendar year if you wait until April. On the flip side, if you ever need to withdraw more than a given year’s RMD, the excess distribution won’t apply to the following year.

If you are still working at 70 ½, you may be able to delay withdrawals from a 401(k) or 403(b) until April 1 following the calendar year you retire, depending on your plan’s terms. But individuals who own 5 percent or more of the business sponsoring a 401(k) plan must take distributions by the initial deadline.

Whatever you do, don’t miss a required withdrawal, or you could incur a 50 percent tax on top of regular income tax for the amount that should have been withdrawn. Calculate your RMD correctly; insufficient withdrawals are subject to the same stiff penalty. Your distribution amount is based on the previous year’s ending balance on each account divided by an IRS estimate of your life expectancy. If your spouse is the sole beneficiary of your account(s) and is more than 10 years younger than you, your RMD will be smaller. (See Table II in IRS Publication 590.)

You must take a distribution from each 401k or most other workplace retirement accounts. If you have multiple IRAs, you can take your RMD from any one of them, ideally choosing a lower performing account. Still another option is to take a qualified charitable distribution (QCD), which steers your RMD directly to a charity, reducing your adjusted gross income. For more details on RMDs, see the IRS website.

As you get older, RMDs can become higher than your planned withdrawal rate. But just because they have to come out of tax-deferred vehicles doesn’t mean you can’t reinvest them in a taxable account or a Roth IRA. We can help you create a retirement distribution plan designed to effectively use the assets you’ve accumulated to fund your retirement. Call Denver wealth manager Jordan Dechtman at 303-741-9772, email him at or visit our website to schedule an appointment. (We do not provide tax advice; coordinate with your tax advisor regarding your specific situation.)

Written by Securities America for Distribution by Jordan Dechtman.

Important Disclosure Information

Please remember that past performance may not be indicative of future results.  Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Dechtman Wealth Management, LLC [“DWM”]), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful.  Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions.  Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from DWM. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. DWM is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the DWM’s current written disclosure Brochure discussing our advisory services and fees is available for review upon request or at

Please Note: DWM does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to DWM’s web site or blog or incorporated herein, and takes no responsibility for any such content. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly.

Please Remember: If you are a DWM client, please contact DWM, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services.  Unless, and until, you notify us, in writing, to the contrary, we shall continue to provide services as we do currently.

Please Also Remember to advise us if you have not been receiving account statements (at least quarterly) from the account custodian.

Join our newsletter

"*" indicates required fields

This field is for validation purposes and should be left unchanged.