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RMDs: When to Take Them and What to Do If You Miss the Deadline

March 28, 2025 9:54 pm

Hey there, retirees! If you’re nearing—or already hit—the magic age of 73, chances are you’ve heard about Required Minimum Distributions (RMDs). These mandatory withdrawals from your retirement accounts can feel like another hoop to jump through, but don’t worry—I’m here to make it simple. And if you’re worried you missed your first one, don’t panic—you’ve got options. Let’s break it down!

When Do You Need to Take Your First RMD?

So, here’s the deal: when you turn 73, the IRS says it’s time to start withdrawing from those tax-deferred accounts—like IRAs and 401(k)s. You can take your first RMD anytime in the year you turn 73. For example, if you celebrate your 73rd birthday in 2025, you can take your RMD at any point during 2025.

But here’s the kicker: the IRS gives you a little breathing room for that first RMD. You have until April 1 of the following year to take it. This means if you turn 73 in 2025, you can wait until April 1, 2026, to complete your first withdrawal.

What Happens If You Wait Until April 1?

Here’s where some planning comes in. If you wait until April 1 to take your first RMD, you’ll also need to take your second RMD by December 31 of that same year. Yep, two RMDs in one year. While this is perfectly legal, it could bump you into a higher tax bracket depending on the amount and your other income. Taking your first RMD earlier in the year can help smooth out your taxes—something worth considering.

What If You Miss the Deadline?

Uh-oh—did you forget to take that first RMD by April 1? Don’t panic! You’re not doomed to face penalties just yet. The IRS understands that mistakes happen, and they offer a way to fix it. If you missed your first RMD deadline, you can request a waiver of the penalty by:

  1. Taking the missed RMD as soon as possible.
  2. Filing IRS Form 5329 (don’t worry, it’s easier than it sounds) and including a letter explaining why you missed the deadline. Common reasons, like illness or a misunderstanding of the rules, are usually considered valid.

The penalty for missing an RMD is 50% of the amount you failed to withdraw, but if you take action quickly and explain your situation, the IRS may waive it entirely.

How to Stay on Track

Here are some tips to avoid future headaches:

  • Set a Reminder: Mark those key dates on your calendar—April 1 for the first RMD and December 31 for all the rest.
  • Work with Your Financial Institution: Many retirement account custodians can calculate your RMD and even automate the withdrawals for you.
  • Plan for Tax Implications: Talk to your financial advisor to strategize the timing of your withdrawals and manage your tax burden effectively.

Final Thoughts

Taking your first RMD might seem like a chore, but with a little planning (and some backup if you miss the deadline), it’s a manageable part of your retirement journey. Whether you decide to withdraw early in the year or use that April 1 extension, what matters most is staying informed and proactive.

You’ve worked hard to build your savings—now it’s time to make the most of them. Let me know if you’d like a deeper dive into any of these details!

IRS Presents: Five New Things to Know About 2009 Taxes

February 17, 2010 7:06 am / Leave a comment

As you get ready to prepare your 2009 tax return, the Internal Revenue Service wants to make sure you have all the details about tax law changes that may impact your tax return.

Here are the top five changes that may show up on your 2009 return.

1. The American Recovery and Reinvestment Act

ARRA provides several tax provisions that affect tax year 2009 individual tax returns due April 15, 2010. The recovery law provides tax incentives for first-time homebuyers, people who purchased new cars, those that made their homes more energy efficient, parents and students paying for college, and people who received unemployment compensation.

2. IRA Deduction Expanded

You may be able to take an IRA deduction if you were covered by a retirement plan and your 2009 modified adjusted gross income is less than $65,000 or $109,000 if you are married filing a joint return.

3. Standard Deduction Increased for Most Taxpayers

The 2009 basic standard deductions all increased. They are:

  • $11,400 for married couples filing a joint return and qualifying widows and widowers
  • $5,700 for singles and married individuals filing separate returns
  • $8,350 for heads of household

Taxpayers can now claim an additional standard deduction based on the state or local sales or excise taxes paid on the purchase of most new motor vehicles purchased after February 16, 2009. You can also increase your standard deduction by the state or local real estate taxes paid during the year or net disaster losses suffered from a federally declared disaster.

4. 2009 Standard Mileage Rates

The standard mileage rates changed for 2009. The standard mileage rates for business use of a vehicle:

  • 55 cents per mile

The standard mileage rates for the cost of operating a vehicle for medical reasons or a deductible move:

  • 24 cents per mile

The standard mileage rate for using a car to provide services to charitable organizations remains at 14 cents per mile.

5. Kiddie Tax Change

The amount of taxable investment income a child can have without it being subject to tax at the parent’s rate has increased to $1,900 for 2009.

For more information about these and other changes for tax year 2009, visit IRS.gov.
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