Retirement & Tax Planning Answers
How to Calculate Required Minimum Distributions From a 401(k)
Quick answer
To calculate a 401(k) RMD: take the account balance as of December 31 of the prior year, then divide it by the distribution period listed for your age in the IRS Uniform Lifetime Table (or the Joint and Last Survivor Table if your sole beneficiary is a spouse more than 10 years younger). For example, a $500,000 balance at age 75, with a distribution period of 24.6, produces an RMD of roughly $20,325. Unlike IRAs, which can be aggregated and withdrawn from any combination of accounts, each 401(k) must satisfy its own RMD separately. The first RMD can be delayed until April 1 of the year after you turn 73, but doing so means taking two RMDs in that same calendar year, both taxable.
How to Calculate a 401(k) Required Minimum Distribution
The RMD formula itself is one division problem. The steps below cover where to find each input and the rules that change the answer.
- 1
Find the account balance as of December 31 of the prior year
The RMD is based on the account's value at the end of the previous calendar year, not the current balance. Your plan statement or online account should show this figure clearly, usually labeled as the prior year-end balance.
- 2
Find your distribution period in the IRS life expectancy table
Most retirees use the Uniform Lifetime Table in IRS Publication 590-B. Look up the distribution period corresponding to your age in the year of the RMD. If your sole primary beneficiary is a spouse more than 10 years younger, use the Joint and Last Survivor Table instead, which produces a smaller RMD.
- 3
Divide the balance by the distribution period
Divide the prior year-end balance by the distribution period number. A $500,000 balance divided by a distribution period of 24.6 (age 75) produces an RMD of approximately $20,325.
- 4
Repeat separately for each 401(k) you hold
401(k) RMDs cannot be aggregated across multiple employer plans the way IRA RMDs can. Each 401(k) must have its own RMD calculated and withdrawn from that specific plan.
- 5
Check the first-year deadline rule
The RMD for the year you turn 73 can be delayed until April 1 of the following year. Doing this means two RMDs land in that following calendar year, one delayed from the prior year and one for the current year, which can push you into a higher bracket for that single year.
- 6
Confirm whether the still-working exception applies
If you're still employed by the company sponsoring the 401(k), don't own more than 5% of the company, and the plan allows it, you may be able to delay RMDs from that specific 401(k) until you actually retire. This exception applies only to the 401(k) at your current employer, not to IRAs or old 401(k)s from prior employers.
The core formula is straightforward: divide the prior year-end account balance by the distribution period the IRS assigns to your age. The complexity people run into isn't the math, it's the rules layered around it.
The most commonly missed rule is that 401(k) RMDs can't be aggregated the way IRA RMDs can. If you hold IRAs at three different institutions, you can calculate the total RMD owed across all three and withdraw it from just one of them. With 401(k)s, each plan's RMD has to be calculated and withdrawn from that specific plan, separately.
The first-year deadline creates a timing trap that's easy to walk into without realizing it. Delaying the very first RMD until April 1 of the following year sounds like a benefit, but it means that year's tax return reports two RMDs instead of one, since the current year's RMD is still due by December 31 of that same year. That can meaningfully increase taxable income for that one year.
The still-working exception is a real but narrow carve-out. If you're actively employed by the plan sponsor, own less than 5% of the company, and the plan document permits it, RMDs from that specific employer's 401(k) can be delayed until actual retirement. It doesn't apply to a former employer's 401(k) or to any IRA.
If you hold multiple old 401(k)s from past employers, calculate and track each one's RMD separately rather than assuming they can be combined the way IRAs can.
If you're weighing the April 1 delay option for your first RMD, run the tax impact of two RMDs landing in the same year before deciding, since the delay isn't automatically the better choice.
- Assuming 401(k) RMDs can be aggregated and withdrawn from just one plan, the way IRA RMDs can.
- Delaying the first RMD to April 1 without checking what two RMDs in one tax year does to that year's bracket.
- Using the wrong life expectancy table, most commonly failing to switch to the Joint and Last Survivor Table when a much-younger spouse is the sole beneficiary.
- Forgetting that rolling an old 401(k) into an IRA changes which aggregation rule applies going forward.