RMD Deadline Looms!

April 1 may be April Fools Day, but a deadline looming on that date is no joke: Participants in retirement plans and IRA holders who attained age 72 after June 30, 2021 must receive their first required minimum distribution (RMD) by April 1, 2022. 

There is an exception to the April 1 deadline, however. Those who are still working for the business sponsoring the retirement plan in which they are participating can delay taking their first RMD from the plan until after they retire. However, this exception does not apply to 5% owners of the business, or to traditional, SEP and SIMPLE IRAs.

Applying the Updated Life Expectancy Tables 

Life expectancy tables were updated for 2022, so the table used to figure the 2022 RMD is different than the version to use for the 2021 RMD. The updated tables will generally lead to smaller required withdrawals for 2022 and future years.

• For a 2021 RMD (due April 1, 2022), The life expectancy tables to be used are those in Appendix B of the Pub. 590-B used for preparing 2020 returns. For example, for an unmarried person using Table III, the RMD for a person age 72 in 2021 will be based on a distribution period of 25.6 years. The balance on Dec. 31, 2020, should be divided by 25.6 to determine the RMD for 2021. 
• For a 2022 RMD (due Dec. 31, 2022), The life expectancy tables to be used are the revised life expectancy tables in Appendix B of the Pub. 590-B used for preparing 2021 returns. For example, for the unmarried person using Table III, now age 73, the RMD will be based on a distribution period of 26.5 years. The balance on Dec. 31, 2021 should be divided by 26.5 to determine the RMD for 2022.

Beginning Dates for the First RMD

IRAs (including SEPs and SIMPLE IRAs):

• April 1 of the year following the calendar year in which you reach age 70½, if you were born before July 1, 1949.
• April 1 of the year following the calendar year in which you reach age 72, if you were born  after Jun 30, 1949.

401(k), profit-sharing, 403(b), or other defined contribution plans: Generally, April 1 following the later of the calendar year in which one:

• reaches age 72 (age 70½ if born before July 1, 1949), or
• retires (if the plan allows this).

Finding Out More

The IRS provides information about the RMD here.