Born March 1952 When to take RMD?

[Venturer]

I will have to take my 1st withdrawal in 2024. I have tapped my IRA once since we retired and that time I just had Fidelity to take out 10% more to send to uncle for tax. Since then reading some here I think mabey that wasn't too smart. so what is best way to do the withdrawal? my ist one is 2024 and then my DW will be 2025. Opinions on time to take and how much will be appreciated,because I know some of y'all are very experienced: Thanks!

 

[TheWizard]

Take out 1/12th of your RMD on the 15th of each month, drawn pro rata from your mix of investments.
Cheers...

 

[frayne]

I don't think you are required to take your RMD until 2025 but feel free to double check me on this. I've been a FIDO customer for five decades. I have been tapping my T-IRA for the last eighteen years (did a 72T back in the day) and basically I have FIDO deposit a monthly amount in my checking account and I also have them withhold 10% on an annual basis to cover my future tax liability. Actually very easy to set up or change as needed as your portfolio dictates.

 

[Car-Guy]

I don't think you are required to take your RMD until 2025. Feel free to double check me on this.

+1, correct for the OP. (Or 2026 if he wants to take it twice and play that game for his first year) IIRC

 

[target2019]

Take out 1/12th of your RMD on the 15th of each month, drawn pro rata from your mix of investments.
Cheers...

Interesting. Would you say the 1st of month would work just as well?

 

[ShokWaveRider]

"Individuals who were born between 1951 and 1959 will need to start their RMDs after age 73"

https://money.usnews.com/money/retirement/401ks/articles/new-rmd-rules-for-2023

 

[TheWizard]

I don't think your first RMD is until 2025.

Correct, the year he turns 73.

Nonetheless, I prefer to think of those tax-deferred accounts for what they really are: Deferred Compensation.
They're not the same sort of wealth that taxable accounts are and don't pass to beneficiaries with stepped up basis.

So I feel it best to withdraw that money similar to how it was when working, as monthly income...

 

[ShokWaveRider]

A SPIA would do it for you, provide a monthly income that is. Could do one with a payout when one passes, or 15-, 20- or 25-year period certain if leaving a legacy is a priority, otherwise open a SPIA (A++ Company) and never worry about it again.

 

[TheWizard]

Interesting. Would you say the 1st of month would work just as well?

Quite possibly, yes.
In my case, I have pension/annuity income hitting my checking account on the first, so I stagger my RMD income by a couple weeks.
YMMV, as someone once said...

 

[jazz4cash]

Wait. Under the new rules you shouldn’t have RMD until 2025 , the year you turn 73. Once you get the starting year figured out there are lots of ways to satisfy the requirement. I don’t see an issue with how you did it before. Make sure you know how to calculate your RMD. Fidelity does this for me but they can’t calculate based on funds in outside accounts.

https://www.irahelp.com/slottreport/ira-rmd-age-made-easy

 

[frayne]

Correct, the year he turns 73.

Nonetheless, I prefer to think of those tax-deferred accounts for what they really are: Deferred Compensation.
They're not the same sort of wealth that taxable accounts are and don't pass to beneficiaries with stepped up basis.

So I feel it best to withdraw that money similar to how it was when working, as monthly income...

Exactly.

 

[latexman]

For the younglings:

 

[EastWest Gal]

According to Schwab:

Your first RMD must be taken by 4/1 of the year after you turn 73. Subsequent RMDs must be taken by 12/31 of each year. If you don't take your RMD, you'll have to pay a penalty, follow the IRS guidelines and consult your tax advisor.

Italics mine.

 

[bada bing]

+1, correct for the OP. (Or 2026 if he wants to take it twice and play that game for his first year) IIRC

That's the right answer, but there's one additional wiggle. If you choose to wait to start until the year after you turn 73, you have to take two rmds that first year and the first one has to happen on/before April 1.

 

[Midpack]

According to Schwab:

Your first RMD must be taken by 4/1 of the year after you turn 73. Subsequent RMDs must be taken by 12/31 of each year. If you don't take your RMD, you'll have to pay a penalty, follow the IRS guidelines and consult your tax advisor.

Italics mine.

+1. First RMD for the OP born Mar 1952 would be 4/1/2026. Direct from the IRS...

Required beginning date for your first RMD
- IRAs (including SEPs and SIMPLE IRAs)
- April 1 of the year following the calendar year in which you reach age 72 (73 if you reach age 72 after Dec. 31, 2022).

https://www.irs.gov/retirement-plan...nt-topics-required-minimum-distributions-rmds

 

[Out-to-Lunch]

Why can't we find a table like this?
(I made this, so consider the source.)

Edit: Midpack tells me that I am off by a year. But I was not intending to make the distinction between the Apr.1 date and the year you attain RMD age. How about this revised version:

birth	RMDAge	RMDstart(Apr)
1949	2021	2022
1950	2022	2023
1951	2024	2025
1952	2025	2026
1953	2026	2027
1954	2027	2028
1955	2028	2029
1956	2029	2030
1957	2030	2031
1958	2031	2032
1959	2032	2033
1960	2035	2036
1961	2036	2037
1962	2037	2038
1963	2038	2039
1964	2039	2040
1965	2040	2041
1966	2041	2042
1967	2042	2043
1968	2043	2044

 

[audreyh1]

According to Schwab:

Your first RMD must be taken by 4/1 of the year after you turn 73. Subsequent RMDs must be taken by 12/31 of each year. If you don't take your RMD, you'll have to pay a penalty, follow the IRS guidelines and consult your tax advisor.

Italics mine.

Yes, but since that means a double whammy the year after you turn 73 most folks take the first RMD the year they turn 73.

 

[Midpack]

Essentially the same as above. But as others have said, you can start 12/31 in the year you turn 73/75 to avoid a "double whammy" in the next year paying 4/1 AND 12/31. Will be by 12/31 thereafter regardless.

 

[frayne]

Yes, but since that means a double whammy the year after you turn 73 most folks take the first RMD the year they turn 73.

Amen

 

[jazz4cash]

Why can't we find a table like this?
(I made this, so consider the source.)n:

[]

I know, right. This is what I was looking for (or something equally simple) but it’s like they want it to be overly complicated. I think it is more confusing to account for the year 1 deadline extension. It is still for the year you turn 73. Better to be conservative. Thanks for your effort.

 

[UpQuark]

Would the timing of the withdrawal depend on when you are going to spend it?

I've got several years left so don't have experience, but from what I've read on these forums, some people pull the whole RMD in December to prep having money for the coming year.

Though, I'm not sure that is the best way, because presumably that means they have a year RMD amount sitting and growing taxable interest while they whittle it down spending over the next year.

 

[Out-to-Lunch]

I know, right. This is what I was looking for (or something equally simple) but it’s like they want it to be overly complicated. I think it is more confusing to account for the year 1 deadline extension. It is still for the year you turn 73. Better to be conservative. Thanks for your effort.

Thank you.

2038 is a long way off, but at this moment in time I can't imagine intentionally pulling two RMDs in the same year, when it could so easily be avoided.

 

[TheWizard]

Thank you.

2038 is a long way off, but at this moment in time I can't imagine intentionally pulling two RMDs in the same year, when it could so easily be avoided.

If you were selling a rental property in your first year of RMDs, it could make good sense to delay that first RMD...

 

[Midpack]

2038 is a long way off, but at this moment in time I can't imagine intentionally pulling two RMDs in the same year, when it could so easily be avoided.

If you were selling a rental property in your first year of RMDs, it could make good sense to delay that first RMD...

Or if you wanted to squeeze in one last larger Roth conversion before starting RMDs. There are cases for and against as usual.

 

[DrRoy]

I would just do once for the year for simplicity.