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

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1. It sounds like you’re looking for information on Required Minimum Distributions (RMDs). RMDs are mandatory withdrawals that individuals must take from their retirement accounts, such as 401(k)s and IRAs, starting at a specific age. As of the latest guidelines, the age for starting RMDs is 73, but this can vary based on when you were born or if your account balances are below certain thresholds.

   If you miss the RMD deadline, it’s crucial to rectify the situation as soon as possible. The IRS imposes hefty penalties for missed RMDs, which can amount to 50% of the missed distribution. Here are a few steps you can consider if you’ve missed your RMD:

   1. Calculate the Missed Amount: Determine how much you should have withdrawn.
   2. Withdraw the Amount Promptly: Take the missed distribution as soon as you realize the mistake.
   3. File IRS Form 5329: This form helps you report the missed RMD and request a penalty waiver. If you missed your RMD due to reasonable error and took the necessary steps to fix it, you might be able to avoid the penalty.
   4. Consult a Professional: Given the complexities of tax implications and retirement planning, consulting a financial advisor or tax professional could be beneficial.

   Planning ahead and understanding RMD requirements can save you from potential penalties down the road. Always stay informed about your retirement account obligations!

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