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When are RMDs taken within the Planner?
When are RMDs taken within the Planner?

This article explains when Required Minimum Distributions are modeled to be taken and how they are handled.

Nancy Gates avatar
Written by Nancy Gates
Updated over a month ago

What is an RMD?

Required minimum distributions, or RMDs, are withdrawals mandated by the Internal Revenue Service once you reach a certain age.

What accounts are subject to RMDs?

If you’re an account owner of a traditional IRA or employer-sponsored retirement plan the IRS mandates that you take a required minimum distribution annually by a specified deadline.

If you are the beneficiary of an Inherited IRA there are a variety of RMD requirements depending upon the type of IRA, the type of beneficiary, and the original owner.

The IRS does not require you to take RMDs on a Roth IRA or Roth 401(k) unless you are a beneficiary.

Required Beginning Date (RBD)

Depending on your birth date, the RBD for Traditional IRAs and employer-sponsored retirement plans is as follows.

If you are born:

  • Before 1/1/1951, your RMDs have already begun

  • Between 1/1/1951 and 12/31/1959 your RMDs must start at age 73

  • After 1/1/1960 your RMDs will begin at age 75

How are RMDs modeled in the Boldin Planner?

IRS rules state that you do not have to take a separate RMD from each IRA. However, if you have more than one defined contribution plan such as a 401(k) and a 403(b), you must calculate and satisfy your RMDs separately for each plan and withdraw that amount from that plan. This is not the process in the Planner and RMDs may be aggregated from accounts depending upon your withdrawal strategy.

How are RMDs used to fund expenses in the Boldin Planner?

For the purposes of the Planner, withdrawals from accounts with an RMD requirement made to fund expenses from January onwards go towards satisfying your RMD requirement. If the RMD is not satisfied by the end of the year, the Planner will model an RMD in December of that year to cover the remaining RMD requirement.

For example, let's say you have an RMD of 30,000 in 2025.

If in the course of January to December of 2025 you have automatically withdrawn $20,000 from your accounts with an RMD requirement, the Planner will model an RMD of $10,000 in December of 2025.

If you instead never needed to touch your retirement savings in the year 2025, the entire RMD will be taken in December of 2025 ($30,000).

If your RMDs exceed your expenses, they are treated as "Excess Income," and abide by your selection in the Excess Income section of My Plan > Money Flows.

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