IRA FAQs: Required Minimum Distributions (RMDs)
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Top RMD questions for 2021
Are RMDs suspended in 2021 as they were in 2020?
The CARES Act, passed in March of 2020, temporarily waived required minimum distributions (RMDs) for all types of retirement plans (including IRAs, 401(k)s, 403(b)s, 457(b)s, and inherited IRA plans) for calendar year 2020. This included the first RMD, which individuals may have delayed from 2019 until April 1, 2020. That waiver expired in December 2020. If you were taking RMDs before 2020 then you need to begin taking them again in 2021. If you turn 72 in 2021 and did not turn 70½ on or before 12/31/19, then you will need to begin taking RMDs for the first time this year. Learn more about Required Minimum Distributions
If I had previously automated my RMDs, do I need to take any action to restart my withdrawal plan?
If one of our associates helped you skip your planned withdrawal for 2020, it should automatically start running again in 2021. If you deleted your plan directly on Fidelity.com then you may need to re-establish it now. You can review your plan status, and establish a new one if needed on our Automatic Withdrawals pageLog In Required.
Do I need to take more than one RMD in 2021 to make up for skipping one in 2020?
No. The waiver in 2020 didn't delay the taking of an RMD for that year. It completely negated the need to take an RMD for the 2020 tax year. You can restart, or begin taking your RMDs in 2021 for the 2021 tax year without the need to take one retroactively for 2020.
I received a 1099-R tax form showing an RMD from 2020 that I returned to my IRA before the August 31, 2020 deadline outlined in the CARES Act. Do I need an updated form to reflect that my distribution was redeposited?
No. Please consult your accountant or tax advisor on how to reconcile this withdrawal with your 1099-R, 5498.
Can I Roll back the RMD that was taken from my IRA in December of 2020?
Yes, 2020 RMD withdrawals were treated as distributions and would be eligible for 60-day rollover treatment. Customers would need to add the Distributed amount back to their December 31, 2020 balance and re-calculate their 2021 RMD.
Can I roll back the RMD for my inherited IRA account that was distributed in December of 2020?
No. Withdrawals from a non-spouse beneficiary inherited IRA were only eligible to be rolled back until August 31, 2020, If they were taken prior to that date.
I turned 70½ in 2019 and delayed my RMD until 2020 did I have to take it?
No. The CARES act waived all RMDs in calendar year 2020. If you turned 70½ in 2019, and delayed your RMD until April 1, 2020, and chose not to take it then either, then your first RMD must be withdrawn by December 31, 2021.
If I turned 72 in 2020 do I need to take my first RMD by April 1, 2021?
The SECURE Act changed the age at which an RMD is required to start to age 72. If you were born on or after July 1, 1949, your first would have been required by April 1, 2021. However, IRS guidance clarified that the April 1, 2020 distribution has also been waived. An RMD in this situation would need to come out, for 2021, no later than December 31, 2021.
If I took a CARES act withdrawal in 2020 does it count toward my RMD for 2020, 2021 and 2022?
No. The provisions in the CARES Act that allowed for the spreading of income tax from a qualified COVID-19 withdrawal over 3 years don't allow for the withdrawal itself to count as RMDs in subsequent years.
What are Required Minimum Distributions (RMDs)?
Once you reach age 72, or if you turned 70½ in 2019,* you may be required to withdraw a certain amount of money from your tax-deferred retirement account each year. The CARES act temporarily waives RMDs for all types of retirement plans for calendar year 2020. This includes the first RMD, which individuals may have delayed from 2019 until April 1, 2020. That amount is called a required minimum distribution (RMD).
RMD rules apply to tax-deferred retirement accounts:
- Traditional IRAs
- Rollover IRAs
- SIMPLE IRAs
- SEP IRAs
- Most small-business accounts (Keoghs)
- Most 401(k) and 403(b) plans
If you own an Inherited IRA the RMD rules are different. Learn about the rules that apply to you.
Do I have to take my RMDs from my Roth IRA?
You don't have to take RMDs from a Roth IRA, if you're the original account owner. However, if you have inherited a Roth IRA, you are subject to RMD rules.
For tax-deferred retirement accounts, withdrawing from a Roth IRA will not meet the RMD requirement.
You always have the option to convert your Traditional IRA into a Roth IRA. However, if you're over age 72* you'll have to take your RMD for the year before you convert. Use our Convert an IRA to a Roth IRA Calculator to help with the conversion process.
Do I have to take my RMD if I'm still working?
Yes, even if you continue working past age 72,* you have to take an RMD from your IRA.
However, you may qualify for an exception from taking RMDs from your current employer-sponsored retirement account, such as a 401(k), 403(b), or small-business account, if:
- You're still working
- You do NOT own more than 5% of the business you work for
- You have an employer-sponsored retirement account with the business you work for
If you meet all the criteria above, you may delay taking an RMD from the account until April 1 of the year after you retire. Keep in mind that this does not apply to IRAs or other accounts you may hold with companies you no longer work for.
Calculating & taking your RMD
How do I calculate my RMD?
Your RMD amount is calculated by dividing your tax-deferred retirement account balance as of December 31 of last year by your life expectancy factor.
*If you have more than one tax-deferred retirement account, this number is the sum of all your account balances on December 31 last year.
**Your life expectancy factor is taken from the Uniform Lifetime Table. We've listed out the factors from age 70 to 75 in the table below:
Age 70 71 72 73 74 75 LIfe Expectancy Factor 27.4 26.5 25.6 24.7 23.8 22.9
See the full version of the Uniform Lifetime Table
However, if your spouse is the sole primary beneficiary and he or she is 10 years younger than you, your life expectancy factor is taken from the Joint Life Table.
If you're a Fidelity customer, log in to see your estimated RMD amountLog In Required.
Don't have a Fidelity account? Estimate your RMD amount by using our RMD calculator.
Will Fidelity calculate my RMD for me?
Yes. If you're a Fidelity customer, log in to see your estimated RMD amountLog In Required.
Don't have a Fidelity account? Estimate your RMD amount by using our RMD calculator.
Can I withdraw my total RMD from one of my retirement accounts?
Yes, if you have multiple retirement accounts it's possible to take your RMD from one, but it depends on the type of retirement account:
For Traditional IRAs, Rollover IRAs, SEP IRAs, SARSEP IRAs, and SIMPLE IRAs: You must calculate the RMD for each of these accounts separately, but you can withdraw the total RMD amount from one or any combination of accounts.
For 403(b)s: RMDs must be calculated separately for each account, but the total amount of the RMD can be withdrawn from any one or a combination of your 403(b) accounts.
For 401(k) and Fidelity Retirement Plan accounts: RMDs must be calculated separately for each account and taken individually from those accounts.
Any distribution from an account that requires an RMD will count toward that year's RMD. Amounts withdrawn in excess of that RMD amount do NOT reduce RMD amounts in future years.
You are not required to take RMDs from your own Roth IRA, and cannot satisfy an RMD requirement with a withdrawal from a Roth IRA.
How do I take my RMD?
Withdrawing online is the easiest way to take your RMD. To make a one-time withdrawalLog In Required from your IRA, you'll follow these steps:
- Enter your withdrawal amount and select an account
- Set up a withdrawal date and where your withdrawals are sent
- Choose your tax withholding amounts
- If necessary, sell your investments to make cash available
You can also set up automatic withdrawalsLog In Required for your RMD on a monthly, quarterly, annual or custom schedule.
If you know your RMD amount and you're ready to withdraw now, take your RMDLog In Required.
If you're ready to withdraw but you don't know your RMD amount, log in to see your estimated RMD amountLog In Required.
Taxes & timing your RMD
How will RMDs impact my taxes?
The IRS taxes RMDs as ordinary income. This means that withdrawals will count towards your total taxable income for the year. Keep in mind that this income increase may push you into a higher tax bracket and may impact the taxes you pay for your Social Security or Medicare. Be sure that you don't miss your RMD deadline, because your tax penalty may be 50% of the amount not taken on time.
If you'd like to reduce the affect of RMDs on your taxes, consider making a qualified charitable distribution (QCD). A QCD excludes the amount you donate from taxable income and can be counted toward satisfying your RMD for the year, as long as certain rules are met.
A tax advisor can help you determine when to take RMDs and if a QCD is appropriate for your situation.
When should I take my first RMD?
The deadline for taking RMDs is December 31 each year. You may delay taking your first RMD (and only your first RMD) until April 1 of the year after you turn 72.* If you choose to delay your first RMD, you'll have to take your first and second RMD in the same year. The CARES act temporarily waives RMDs for all types of retirement plans for calendar year 2020. This includes the first RMD, which individuals may have delayed from 2019 until April 1, 2020.
To understand how delaying your first RMD impacts your taxes and future RMDs, review your options and consider speaking with your tax advisor.
What are the deadlines for taking RMDs?
After you take your first RMD, your deadline will always be December 31 each year. The CARES act temporarily waives RMDs for all types of retirement plans for calendar year 2020. This includes the first RMD, which individuals may have delayed from 2019 until April 1, 2020. If you miss the deadline your penalty may be severe—50% of the amount not taken on time.
If it's your first year taking RMDs, see the question above: When should I take my first RMD?
What are the penalties if I miss a deadline?
It's important to remember your RMD deadline, because there may be a severe penalty of 50% of the amount not taken on time. The CARES act temporarily waives RMDs for all types of retirement plans for calendar year 2020. This includes the first RMD, which individuals may have delayed from 2019 until April 1, 2020.
For example, say you're 74 years old and your RMD for the year is $15,000, but you only withdrew $7,000 by December 31. You'll have to pay the penalty for the remaining $8,000 you did not take on time. This means that you may owe the IRS a $4,000 penalty for missing your RMD deadline that year.
If you do miss the deadline, you may be able to request a waiver by filing IRS Form 5329. Please discuss your options with a tax advisor.
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If you own an inherited IRA, your RMD rules are different. Learn about the rules that apply to you.