For decades the deal on a traditional 401(k) or IRA was simple: contribute pre-tax, let it compound, and worry about taxes later. In 2026, "later" arrives for a wave of retirees. If you turn 73 this year — anyone born in 1953 — the IRS now requires you to start pulling money out of those accounts through required minimum distributions, or RMDs. This isn't a tax you can defer further or a suggestion you can ignore. The withdrawal is mandatory, the penalty for skipping it is steep, and for larger balances the bite is bigger than most people expect. Here's exactly what the 2026 rules require and how to keep the hit as small as the law allows.
Who's on the clock in 2026 — and the two deadlines that matter
Thanks to the SECURE 2.0 Act, the age your RMDs begin depends on your birth year. If you were born between 1951 and 1959, your RMDs start the year you turn 73. If you were born in 1960 or later, you get to wait until 75. So for 2026, the newest group on the clock is people born in 1953, who turn 73 this year.
There are two deadlines, and confusing them is a classic first-year mistake. Your very first RMD can be delayed until April 1 of the year after you turn 73 — for a 2026 first-timer, that's April 1, 2027. Every RMD after that, including the second one, is due by December 31. Lean on that April grace period and you'll take two taxable distributions in the same calendar year, which can shove you into a higher bracket. For most retirees, taking the first RMD by December 31, 2026 is the cleaner play.
The number that surprises people: how the IRS sizes your withdrawal
Your RMD isn't a flat percentage. The IRS takes your account balance as of December 31 of the prior year and divides it by a life-expectancy factor from its Uniform Lifetime Table. At age 73, that factor is 26.5 — so your first RMD is roughly your year-end balance divided by 26.5, or about 3.8% of the account.
That sounds modest until you run real balances. A $1 million traditional 401(k) produces a first RMD of about $37,736. A $2.5 million balance triggers roughly $94,340 — about $7,862 a month — landing on your tax return whether or not you need a dime of it. Because the withdrawal is fully taxed as ordinary income, a big RMD can do more than raise your tax bill: it can make more of your Social Security taxable and push you across income thresholds you didn't know existed.
The hidden trap: IRMAA and the 40% marginal squeeze
The quiet danger of a large RMD is what it does to your Medicare premiums. Cross an income line and you owe an IRMAA surcharge — the Income-Related Monthly Adjustment Amount — on top of standard premiums. For 2026, a single filer with modified adjusted gross income above roughly $109,000, or a couple above $218,000, crosses the first IRMAA tier. The standard Part B premium is about $203 a month, and that first tier adds roughly $1,148 per person per year in combined Part B and Part D surcharges.
Stack it all up — the 22% federal bracket, more of your Social Security becoming taxable, and the IRMAA surcharge — and the effective tax on the last slice of a big RMD can push toward 40%. That's the real reason RMDs are nicknamed a "tax bomb": the headline withdrawal looks manageable, but the knock-on effects on Medicare and Social Security do the damage.
What's actually new for 2026
- Roth 401(k)s are off the hook. As of 2024 and continuing in 2026, designated Roth accounts inside a 401(k) or 403(b) no longer require lifetime RMDs — matching the long-standing Roth IRA rule. If your Roth 401(k) money was getting swept into your RMD math, it shouldn't be anymore.
- The charitable cap rose to $111,000. The qualified charitable distribution (QCD) limit is indexed to inflation and climbs to $111,000 per person for 2026, up from $108,000 in 2025.
- The missed-RMD penalty is 25% — but fixable. Skip or under-withdraw an RMD and the excise tax is 25% of the shortfall. Correct the error and file an amended return within two years and that penalty drops to 10%.
- The age-75 group is still waiting. Anyone born in 1960 or later doesn't face a first RMD until 2035 or later, which leaves a longer runway for the planning moves below.
Two legal moves that shrink the bill
First, the qualified charitable distribution. If you give to charity anyway, a QCD lets you send up to $111,000 in 2026 directly from your IRA to a qualifying nonprofit. The transfer counts toward your RMD but never lands in your taxable income — so it satisfies the requirement without inflating the MAGI that drives your IRMAA and Social Security taxation. The donation has to move directly from the custodian to the charity by December 31 to count.
Second, Roth conversions in the gap years. The window between retiring and your RMD start date is the cheapest time to convert traditional dollars to Roth. You pay tax on the converted amount now, ideally while you're in a lower bracket and before RMDs and Social Security stack on top, and every dollar you move shrinks the future balance the IRS forces you to withdraw. Convert enough over several years and you can meaningfully lower the RMDs — and the IRMAA exposure — waiting for you at 73.
A quick checklist before year-end
Confirm your December 31, 2025 balance, divide by 26.5 to estimate your 2026 RMD, and ask your custodian whether they'll auto-distribute it — many do, but the legal responsibility is yours. If you're charitably inclined, route part of it as a QCD before December 31 to keep it out of your taxable income. And if you're a few years shy of 73, model a Roth conversion now rather than later.
RMDs feel like a punishment, but they're really just the IRS finally collecting on a tax break you took years ago. The retirees who get hurt are the ones caught flat-footed — missing the deadline, eating the 25% penalty, or letting an oversized withdrawal quietly raise their Medicare premiums and tax on Social Security. The ones who come out ahead plan the drawdown years in advance: they convert in the gap years, give strategically through QCDs, and know their number before the deadline arrives. If you want to see how your balance, withdrawals, and timeline fit together, run the figures through our Retirement Savings Calculator and build the plan before the clock, not after.
