New RMD Rules: Starting Age, Penalties, Roth 401(k)s, and More

The SECURE 2.0 Act makes major changes to the required minimum distribution rules.

The words RMD and required minimum distributions are typed on a notecard next to a calculator and pen.
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There are some new rules for required minimum distributions (RMDs) from retirement savings accounts (e.g., traditional IRAs and 401(k) plans). President Biden has signed the SECURE 2.0 Act of 2022, which makes significant changes to the way Americans save for and are taxed in retirement. And one of the major areas of focus in the new law is reforming RMDs.

It wasn't all that long ago that the retirement-savings landscape was shaken up. Among other things, the original SECURE Act, which was enacted in 2019, extended the age at which you must start taking RMDs from 70½ to 72. That was a big boost for many seniors, who can now keep money in their tax-free retirement accounts a little longer. But that wasn't enough help for retirees in the eyes of many lawmakers. So, as soon as the ink was dry on the SECURE Act of 2019, a few key members of Congress began planning additional legislation to help more people save for retirement and hold on to their money longer in retirement. Those efforts resulted in the SECURE 2.0 Act of 2022.

For retirees or those approaching retirement who are worried about mandatory retirement account distributions, getting up to speed on the new RMD changes is very important. You need to know how the new RMD rules will impact you in order to properly plan your finances in the future. Check out the new RMD rules discussed below now, so you're not caught off guard when it's time for you to take RMDs from your retirement savings accounts.

[Note: For a general overview of the SECURE 2.0 Act, see Massive Year-End Budget Bill Includes Bipartisan SECURE 2.0 Retirement Savings Package.]

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Rocky Mengle
Senior Tax Editor, Kiplinger.com

Rocky was a Senior Tax Editor for Kiplinger from October 2018 to January 2023. He has more than 20 years of experience covering federal and state tax developments. Before coming to Kiplinger, he worked for Wolters Kluwer Tax & Accounting and Kleinrock Publishing, where he provided breaking news and guidance for CPAs, tax attorneys, and other tax professionals. He has also been quoted as an expert by USA Today, Forbes, U.S. News & World Report, Reuters, Accounting Today, and other media outlets. Rocky has a law degree from the University of Connecticut and a B.A. in History from Salisbury University.