Overview
- RMDs generally begin at age 73, with eligibility to delay until 75 for those who turn 74 in 2033 or later.
- Once withdrawn, RMD dollars cannot return to traditional IRAs or 401(k)s, but they can be invested in taxable brokerage accounts without limits or contributed to Roth accounts only after withdrawal and within annual caps.
- Roth conversions shrink future RMDs, though the converted amount is taxed in the year of conversion, and later Roth withdrawals do not factor into Medicare or Social Security tax calculations.
- Qualified charitable distributions from IRAs can satisfy RMDs without raising modified adjusted gross income, and workplace plan assets must be rolled to an IRA to use QCDs.
- RMDs may be taken in cash or in kind to a taxable account, triggering income tax either way, and transferred assets receive a new cost basis at fair market value, so retirees should set aside cash to cover taxes and realign investments as needed.