The IRS has issued a reminder that retirees who turned 73 in 2024 must take their first Required Minimum Distribution (RMD) from IRAs, 401(k)s, and similar retirement accounts by April 1, 2025. Failing to withdraw the required amount can result in substantial penalties, making it essential for retirees to meet this deadline.
RMDs are mandatory withdrawals from tax-deferred retirement accounts, ensuring that retirees pay income taxes on their savings. The IRS determines the required amount based on life expectancy and account balances at year-end.
RMDs apply to:
Roth IRAs do not require RMDs unless inherited.
With the April 1 deadline approaching, retirees should review their account balances, distribution schedules, and tax strategies to ensure compliance. Failing to take an RMD on time can lead to unnecessary penalties and tax complications.
If you’re unsure how much you need to withdraw or how to minimize taxes on RMDs, consider speaking with a financial advisor or tax professional.