According to the IRS, the last day for retirees to start taking money out of their IRAs and 401(k)s is April 1. This deadline is important because once retirees reach a certain age, they are required to start taking minimum distributions from their retirement accounts.
The IRS requires retirees to start taking these minimum distributions, also known as Required Minimum Distributions (RMDs), by April 1 of the year following the year they turn 721. However, it’s important to note that this age requirement was changed from 70½ to 72 as a result of the Setting Every Community Up for Retirement Enhancement (SECURE) Act, which became law on December 20, 2019.
Failure to take the required minimum distributions by the deadline can result in significant penalties. The amount of the RMD is determined based on various factors, including the account balance, life expectancy, and marital status.
If you are unsure about the specific RMD rules that apply to your retirement accounts, it is advisable to consult with a financial advisor or tax professional who can provide personalized guidance based on your individual circumstances.
