Understanding your Required Minimum Distributions in 2025 is important because getting it wrong could cost you. If you have retirement savings in a 401(k) or an IRA, you can avoid paying taxes upfront when you contribute, letting you invest more today. But eventually, the government requires you to start withdrawing from your account, which means paying taxes on those withdrawals.
If you don’t follow the rules, you could face penalties. Missing an RMD can lead to a fine of up to 25% of the amount you should have withdrawn.
How the government calculates your RMD
To calculate your RMD, the IRS looks at two key factors:
- Your account balance at the end of the previous year
- Your age for the current year
The IRS uses a life expectancy table to determine how long you’re expected to live. You divide your account balance by that number to find your RMD. If your spouse is your beneficiary and they’re more than 10 years younger than you, a different table is used.
You can’t combine RMDs from different accounts. For example, your 401(k) RMD is separate from your IRA. However, if you have multiple IRAs, you can combine the RMDs and take the total amount from one account.
In case you want to learn more about additional benefits, such as New Social Security payments of $1,600 to $4,018 in 2025. Find out who qualifies
When do Required Minimum Distributions in 2025 start?
| Age | Required Minimum Distribution (RMD) Start Age |
| 72 | RMDs start at age 72 for those born before 1960 |
| 73 | RMDs start at age 73 for those turning 73 in 2025 |
| 75 | RMDs start at age 75 for those born in 1960 or later |
Inherited IRAs often come with RMDs, too
If you inherit an IRA, you have different options. Spouses can roll the IRA into their own. But if you inherited the account before 2020, you may need to follow RMD rules based on your life expectancy.
Starting Required Minimum Distributions in 2025, most non-spouse beneficiaries must empty the inherited IRA within 10 years. If the original account holder was already taking RMDs, you must continue taking them every year. Make sure you’re set up with your financial institution to take the RMD this year if you’ve inherited an IRA.
Also, if you’re curious about the performance of retirement funds, TSP Funds Gain in January: See Which Fund Performed Best, could be of interest to you as well.
FAQs
What is an RMD?
An RMD is a required minimum distribution from retirement accounts like 401(k)s or IRAs once you reach a certain age.
When do I have to start taking RMDs?
If you turn 73 in 2025, you must start taking RMDs. Your first distribution is due by April 1 of the next year.
Can I combine RMDs from different accounts?
No, you can’t combine RMDs from different accounts, except for multiple IRAs.