Required beginning date

IRA timing and workplace plan timing

A traditional IRA owner's required beginning date is April 1 of the calendar year following the calendar year in which the owner reaches the applicable age. Continued employment does not postpone it.

SEP and SIMPLE IRAs follow the IRA distribution rules even though they receive employer contributions.

An employer plan's required beginning date generally is April 1 of the calendar year following the later of the calendar year the employee reaches the applicable age or the calendar year the employee retires.

Retirement postponement does not apply to a 5 percent owner. For that employee, the deadline is April 1 of the calendar year following the calendar year of reaching the applicable age.

A plan may instead set April 1 of the calendar year following the calendar year of reaching the applicable age as the required beginning date for all employees, regardless of ownership status.

Ask your plan administrator to identify the plan's rule before relying on retirement postponement. For an IRA, ask the custodian to confirm your applicable age and first distribution deadline.

The first distribution and later distributions

The first distribution calendar year's RMD may be completed by April 1 of the following calendar year. Subsequent annual RMDs remain due by the end of their own calendar years, including the year containing the required beginning date.

Deferring the first RMD into the following calendar year therefore puts two annual RMD deadlines in that year.

Before choosing when to take the first distribution, ask your tax adviser to compare withdrawal schedules. Bring account statements and the provider's deadline confirmation.

Why the date matters after death

If an owner dies on or after the required beginning date, any unpaid lifetime RMD for the year of death must be distributed to the beneficiary or beneficiaries during that year.

An owner who dies before the required beginning date has no lifetime RMD for the year of death.

For an inherited IRA or defined contribution account, a designated beneficiary who is not an eligible designated beneficiary must empty the account by the end of the calendar year containing the tenth anniversary of the owner's death.

If that owner died on or after the required beginning date, that beneficiary must also take annual life expectancy distributions in the first nine years.

Two related terms

Conduit trust: A see through trust requiring all retirement plan distributions it receives to be paid directly to, or for the benefit of, specified trust beneficiaries.

Accumulation trust: Any see through trust that is not a conduit trust.

A perspective on uncertainty

Alongside the deadline discussion, consider what uncertainty means for your own planning conversations.

"we do not know the rate that these funds are going to be taxed that in the future. And that's, you know, that uncertainty has a cost to it, right?"

Common questions