required beginning date
The date by which required minimum distributions must begin — April 1 of the year following the year you turn 73.
Example
“Missing the required beginning date triggered a 25% penalty on the amount that should have been distributed.”
Memory Tip
APRIL 1 — the deadline to start RMDs. Miss it and pay a steep penalty.
Why It Matters
Understanding the required beginning date is crucial because missing this deadline can result in significant tax penalties of up to 25% on the amount you failed to withdraw. Starting distributions on time ensures you stay compliant with IRS regulations and helps you plan your retirement income strategy effectively.
Common Misconception
Many people mistakenly believe they can delay taking distributions indefinitely if they do not need the money, but the IRS requires you to start withdrawals at a specific age regardless of whether you want or need the funds. Another common error is thinking the deadline is December 31 of the year you turn 73, when it actually extends to April 1 of the following year.
In Practice
If you turn 73 on any date during 2024, your required beginning date is April 1, 2025, and you must take your first required minimum distribution by that date. For example, someone who turns 73 in June 2024 with a traditional IRA balance of $500,000 and a life expectancy factor of 24.2 would need to withdraw approximately $20,661 by April 1, 2025, or face a substantial penalty.
Etymology
From IRS RMD rules — the latest permissible start date for distributions.
Common Misspellings
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