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The penalties for messing up an RMD can be stiff, so it's important to know all the rules. Failing to take an RMD could result in a penalty as high as 25% of the amount you were meant to withdraw.
So in the case of two 401(k)s, one with a $4,000 RMD and one with a $6,000 RMD, your only choice to avoid the penalty would be to withdraw at least $4,000 from the first and at least $6,000 from ...
Also, those who just turned 73 this year have until April 1, 2025, to make their RMDs for 2024. But if none of the above rules apply to you, you only have a few weeks left to make your 2024 RMD.
2 New Required Minimum Distribution (RMD) Rules Everyone Must Know Before 2025 ... plans were subject to RMD rules in 2023, but that changed in 2024 due to the Secure 2.0 Act. ... the penalty is ...
This is an overview of rules based on Internal Revenue Code Section 401(a)(9). The rules are detailed at Treas. Regs. 1.401(a)(9)-1 to -9 and 1.408-8. [7] The nonspouse rollover rules were passed in Section 829 of the Pension Protection Act of 2006 and interpreted by IRS Notice 2007-7, 2007-5 IRB 1.
The penalty for missing an RMD can be quite steep -- up to 25% of the amount you were supposed to withdraw -- and you'll still have to make the distribution and pay the income taxes on top of that.
The penalties for missing a required distribution can be quite steep. You could owe up to 25% of the amount you were supposed to withdraw if you don't do so in a timely manner.
Here are three RMD rules everyone must know before the end of 2024. Three square pieces of paper with the letters R M D printed on them. Image source: Getty Images.