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What Is A Required Minimum Distribution (RMD)?

An RMD is the required amount that Traditional IRA, and owners and qualified plan participants must start distributing from their retirement accounts by April 1 following the year that they turn 70½. RMD amounts must then be withdrawn every year after. Generally, RMDs apply only to Traditional, SEP and SIMPLE IRAs — not Roth IRAs.

Your RMD is based on your age, your IRA’s previous year account balance, and a “life expectancy factor” that is provided by the IRS. The institution(s) where you hold your account(s) can calculate your RMD. Institutions cannot see, however, all the IRAs that you may hold in other places, so, ultimately, it’s your responsibility to determine the total RMD amount for all of your accounts.