How do I Calculate the Required Minimum Distribution (RMD)?

FINRA has a Required Minimum Distribution Calculator that you can use to figure out how much your RMD will be. This calculator assumes that if you are married, your spouse is less than 10 years younger that you.  If your spouse is more than 10 years younger than you, then you must use a different withdrawal factor which requires you to pull less out of your IRA each year, thereby making your IRA last longer since your spouse is younger than you are and presumably the IRA will need to provide income for both of you.

What you need to do:

* Gather your IRA and 401(k) statements that show the end of year (December 31st) balances.

* Add the balances together (only per person;  Do not combine the balances of the spouse’s accounts together. If you are married you should have a “spouse 1 balance” and a “spouse 2 balance”.)

* Using the link below to put in your balance and your age at the end of the year, and the calculator will give your RMD figure.

http://apps.finra.org/Calcs/1/RMD

IRS RMD Worksheet

Are you more of the paper and pencil type?  Then this worksheet, from the IRS website, that walks you through the calculation might be your style.  https://www.irs.gov/pub/irs-tege/uniform_rmd_wksht.pdf  Use this worksheet unless you have a spouse that is more than 10 years younger than you are.

IRS RMD Tables

Or do you need to use one of the alternative tables because you have an inherited IRA or your spouse is more than 10 years younger than you?  Use this IRS IRA Required Minimum Distribution Worksheet with a link to the tables: https://www.irs.gov/pub/irs-tege/jlls_rmd_worksheet.pdf

Avoid the Penalty

Remember the penalty for not taking your RMD. So be sure to take your required distributions.

Required Minimum Distribution (RMD) blog post series

Required Minimum Distributions generate many questions so I am creating a series of blog posts to address these questions:

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