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Calculate your RMD

If you are age 73, you may be subject to taking annual withdrawals, known as required minimum distributions (RMDs) from your tax-deferred retirement accounts, such as a traditional IRA. Questions? Call 800-435-4000.

Need to take your RMD from your Schwab account? See your RMD amount and learn more about how we've automated things to make distributions easy.

 

Calculate your inherited IRA RMD

For those who inherited an IRA due to the death of the original account holder. Get started.


Once you have your RMD, what's next?

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  • Move it to Schwab
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Quick answers to Frequently Asked Questions (FAQs) about RMDs

Depending on your date of birth, the IRS requires you to take money out of most types of retirement accounts. These mandatory withdrawals are called required minimum distributions (RMDs). Note: The RMD age changed to 73 when the SECURE Act 2.0 passed in 2022. If you turned 72 before 2023, you may be subject to RMDs. If you turned 72 in 2023, your RMDs will begin at age 73.

In general, you should take your RMDs by the end of the year (December 31).
 
In the year you turn RMD age, you have the option to complete your first RMD by April 1 of next year. If you do this, you'll need to take two distributions in the same tax year:

  • Complete your first RMD by April 1.
  • Complete your second RMD by December 31.
  • This could have tax implications. For more information, consult with our tax advisor.

If you don't make withdrawals, you’ll be subject to pay a penalty.

The new SECURE 2.0 reduces the 50% penalty for missing an RMD effective for RMDs in 2023, it does not impact missed RMDs in 2022. Under SECURE 2.0 if you don't take your RMD by the IRS deadline, a 25% excise tax on insufficient or late RMD withdrawals applies. If the RMD is corrected timely, the penalty can be reduced down to 10%. Follow the IRS guidelines and consult your tax advisor. 

You must take an RMD for these types of retirement accounts:

IRAs (Individual Retirement Accounts)

  • Traditional
  • Rollover
  • Inherited
  • SEP (Simplified Employee Pension)
  • SIMPLE (Savings Incentive Match Plan for Employees)

Qualified Retirement Plans1 (QRPs)

  • QRP/Keogh
  • Individual 401(k)
  • 403(b)(7)

Generally, no, you don't need to take an RMD for a Roth IRA unless you inherited one.

Because the SECURE Act changed the laws regarding inherited IRAs, people will generally fall under one of two rules. Those under the old rules may be required to take RMDs from inherited IRAs. Those under the new 10-year rule may not have an annual RMD. We recommend consulting with your tax or financial advisor, as these new rules can be complex. Learn more about beneficiary types and distribution options.

If the IRA owner passed away before 2020, you will likely fall under the old distribution rules. Certain eligible designated beneficiaries can also fall under the old distribution rules. We recommend consulting with your tax or financial advisor to determine which distribution rules apply in your situation. Learn more about beneficiary types and distribution options.

  • Surviving spouses 
  • Minor children up to age of majority 
  • Disabled individuals—under strict IRS rules 
  • Chronically-ill individuals 
  • Individuals no more than 10 years younger than the IRA owner, such as siblings near the same age

If the original account owner died after 2019 and you (as an individual) do not meet the requirements to be considered an eligible designated beneficiary, you will generally be considered a designated beneficiary and be subject to the 10-year distribution rules. Under this rule, all assets in the account need to be distributed no later that the end of the 10th year from when the original account owner died. Furthermore, if the original account owner was already required to take RMDs at the time of their death, the designated beneficiary will also need to take RMDs during the 10-year period. If the decedent died before RMDs were required to begin, no RMDs are required during the 10-year period. If you fail to distribute all of the assets before the end of the 10th year, those assets will be subject to the RMD excise tax of 25% (for RMDs due after 2022).

Use our Inherited IRA RMD calculator to help you make these determinations.

You can use the Traditional IRA calculator if you've inherited an IRA from a spouse.

The amount of your RMD is usually determined by the fair market value (FMV) of your IRA as of December 31 of the previous year, factored by your age and your life expectancy using the uniform life expectancy method. Sometimes FMV and RMD calculations need to be adjusted after December 31. If you had a transfer or rollover to your Schwab retirement account(s), a conversion from a traditional IRA to a Roth IRA and back, or any correction for security price after year-end, please call us at 877-298-8010 so we can recalculate your RMD.

Yes, you can withdraw more than the RMD from your IRAs without IRS penalty. Remember, these withdrawals will generally be taxable as ordinary income and won't satisfy your RMD requirements in future years. We recommend consulting with your tax advisor.

The total amount of your RMD is generally taxed as ordinary income at your personal federal income tax rate. State taxes may also apply. Your tax liability and any tax withholding you elect are based on your home (legal) address.

No, RMDs can't be reinvested back into an IRA or 401(k), or rolled into another tax-favored retirement account. So, if you don't need it for living expenses, what can you do? Invest it in a taxable brokerage account. Save it in a bank account. Donate to a charity. Contact us for ideas suited to your needs.

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