{"id":435881,"date":"2025-12-09T15:41:15","date_gmt":"2025-12-09T15:41:15","guid":{"rendered":"https:\/\/www.europesays.com\/us\/435881\/"},"modified":"2025-12-09T15:41:15","modified_gmt":"2025-12-09T15:41:15","slug":"the-required-minimum-distribution-deadline-is-coming-what-to-know","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/us\/435881\/","title":{"rendered":"The required minimum distribution deadline is coming. What to know"},"content":{"rendered":"

As year-end approaches, many investors still need to take required withdrawals<\/a> from retirement accounts<\/a> \u2014 or face an IRS penalty of up to 25%. This includes retirees and certain heirs with an inherited individual retirement account<\/a>.<\/p>\n

At age 73, most retirees must start required minimum distributions<\/a>, or RMDs, from pretax accounts. Your first RMD is due by April 1 of the year after turning 73, and the deadline for future withdrawals is Dec. 31. For heirs facing RMDs, the annual deadline is also Dec. 31.<\/p>\n

With the annual deadline nearing, many investors haven’t yet made their required withdrawal, according to data from Fidelity.\u00a0<\/p>\n

As of Nov. 30, 53% of Fidelity investors who needed a 2025 RMD hadn’t taken one \u2014 and 29% of those outstanding RMDs were from inherited IRAs, Fidelity reported.\u00a0The data does not consider possible RMDs taken from accounts with other firms.<\/p>\n

More from Financial Advisor Playbook:<\/p>\n

Here’s a look at other stories affecting the financial advisor business.<\/p>\n

At this point, if you’re subject to the Dec. 31 deadline, you should “take it as soon as you can,” Sham Ganglani, retirement distributions leader at Fidelity, told CNBC.\u00a0<\/p>\n

Otherwise, you could have less flexibility with the withdrawal. For example, some investors have to sell assets to make cash available for the RMD, he said. <\/p>\n

Every year, millions of investors must follow complex RMD rules or face an IRS penalty<\/a>. Those rules have changed in recent years amid new legislation<\/a> and agency guidance.\u00a0<\/p>\n

What to know about the missed RMD penalty<\/p>\n

If you don’t take your full RMD by the due date, the penalty is 25% of the amount you should have withdrawn. That could be reduced to 10% if the RMD is “timely corrected” within two years, and you file Form 5329<\/a>, according to the IRS.<\/p>\n

In some cases, the IRS could waive the penalty entirely if the shortfall happened due to “reasonable error” and you’ve taken “reasonable steps” to fix the mistake, according to the agency.\u00a0<\/p>\n

If you miss the Dec. 31 RMD deadline, take the funds “as fast as you possibly can,” to demonstrate a “timely” withdrawal, said Ganglani. “[The IRS] seems to be willing to work with you when you are doing the right thing.”\u00a0 \u00a0 <\/p>\n

Inherited IRA rules are ‘the biggest landmine’<\/p>\n

The complicated rules for inherited IRAs could also lead to IRS penalties, experts say.\u00a0\u00a0<\/p>\n

“This is the biggest landmine in 2025,” said certified financial planner Scott Van Den Berg, president of advisory firm Century Management in Austin.<\/p>\n

Since 2020, certain inherited accounts are subject to the “10-year rule<\/a>,” which means heirs must deplete the balance by the 10th year after the original account owner’s death.\u00a0 \u00a0\u00a0\u00a0\u00a0<\/p>\n

Plus, some non-spouse beneficiaries, such as adult children, must start taking RMDs in 2025 over the 10-year period.<\/p>\n

If the original account owner already started RMDs before death, non-spouse heirs must continue RMDs yearly. Previously, the IRS waived penalties for missed RMDs, but that no longer applies for 2025.<\/p>\n

“Many beneficiaries have no idea the rule changed,” Van Den Berg said.<\/p>\n","protected":false},"excerpt":{"rendered":"As year-end approaches, many investors still need to take required withdrawals from retirement accounts \u2014 or face an…\n","protected":false},"author":3,"featured_media":435882,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[64,81,12154,26391,3346,255,708,16285,53834,67,132,68],"class_list":{"0":"post-435881","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-business","9":"tag-business-news","10":"tag-financial-consulting","11":"tag-government-taxation-and-revenue","12":"tag-investment-strategy","13":"tag-personal-finance","14":"tag-retirement-planning","15":"tag-suppress-zephr","16":"tag-tax-planning","17":"tag-united-states","18":"tag-unitedstates","19":"tag-us"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@us\/115690371970792512","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/435881","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=435881"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/435881\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/435882"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=435881"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=435881"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=435881"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}