Required Minimum Distributions (RMDs)

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Required Minimum Distributions (RMDs)

When you own a Traditional, Rollover, SEP or SIMPLE IRA, you must begin taking distributions each year once you reach a certain age. This table summarizes the ages at which Required Minimum Distributions (RMDs) must begin:

Birth Year	Age at Which RMDs Begin
1950 or earlier	72 (70½ for those who turned 70½ prior to 2020)
1951-1959	73
1960 or later	75

RMDs are taxed as ordinary income according to your federal and state income tax rates.

RMDs are serious business. If the RMD is not taken, a 25% IRS penalty tax is assessed on the taxable amount that should have been withdrawn for the given tax year.

If you don’t need the cash, your RMD can be invested into a non-IRA account at Sit. Although the RMD is still taxable, you’re able to keep your money invested in the fund(s) of your choice.

Contents

RMD Form
Required Beginning Date
RMD Calculation
RMDs from More Than One IRA
Determining the Non-Taxable Portion of an RMD
IRS Uniform Lifetime Table
Qualified Charitable Distribution

RMD Form

To take your RMD, complete the Required Minimum Distribution form. If you’d like Sit to automatically recalculate and distribute your RMD each year, be sure to check the appropriate box under the heading “Systematic Distributions.”
Your RMD may be withdrawn in one or more distributions throughout the year, as long as the total required amount is taken by December 31^st.

Required Beginning Date

This table summarizes the ages at which Required Minimum Distributions (RMDs) must begin:

Birth Year	Age at Which RMDs Begin
1950 or earlier	72 (70½ for those who turned 70½ prior to 2020)
1951-1959	73
1960 or later	75

NOTE: Your first RMD can be delayed until April 1^st of the following year. If you postpone it into the following year, you will need to take two distributions that year (one for the previous year and one for the current year).

RMD Calculation

Would you like Sit to calculate your RMD amount? Contact an investor services representative at 800-332-5580 or send an email to info@sitinvest.com.
If you would prefer to calculate your RMD, simply take your IRA balance on December 31^st and divide it by the number that corresponds to your age in the IRS Uniform Lifetime Table. If your spouse is more than 10 years younger than you and is the sole primary beneficiary of your IRA, you can use the IRS Joint Life and Last Survivor Table. This may result in a smaller RMD for you. The lengthy table is in IRS Publication 590-B located at www.irs.gov.

RMDs from More Than One IRA

The total amount of your RMD can be taken from as few or as many IRAs as you would like.
RMDs from company retirement plans, such as a 401(k) plan, and inherited IRAs, must be taken separately from each plan.

Determining the Non-Taxable Portion of an RMD

If you made non-deductible contributions to one or more IRAs, the IRS requires that you aggregate all your IRAs to determine the taxable amount of your RMD.

EXAMPLE

Many years ago, Jenny made a $2,000 non-deductible contribution to an IRA. Her other contributions were deductible. Today, she has three IRAs that total $10,000.

Jenny redeems $1,000. Since her non-deductible contribution makes up 20% of her total IRA balance, 20% of her $1,000 distribution (i.e. $200) is not taxable, regardless of which IRA is redeemed.

NOTE: This is a simplified example. Be sure to complete and attach IRS Form 8606 “Nondeductible IRAs” with your taxes.

IRS Uniform Lifetime Table

Use the divisor for the age you were, or will be, on your birthday this year.
Do not use this table if you inherited your IRA.
Do not use this table if your spouse is your sole primary beneficiary and is more than 10 years younger than you.

IRS Uniform Lifetime Table for 2022 and Later-Year RMDs

Age	Divisor	Age	Divisor	Age	Divisor
72	27.4	89	12.9	106	4.3
73	26.5	90	12.2	107	4.1
74	25.5	91	11.5	108	3.9
75	24.6	92	10.8	109	3.7
76	23.7	93	10.1	110	3.5
77	22.9	94	9.5	111	3.4
78	22.0	95	8.9	112	3.3
79	21.1	96	8.4	113	3.1
80	20.2	97	7.8	114	3.0
81	19.4	98	7.3	115	2.9
82	18.5	99	6.8	116	2.8
83	17.7	100	6.4	117	2.7
84	16.8	101	6.0	118	2.5
85	16.0	102	5.6	119	2.3
86	15.2	103	5.2	120 & over	2.0
87	14.4	104	4.9
88	13.7	105	4.6

Qualified Charitable Distribution

Would you like to keep your taxable income low? If you’re at least 70½ years old, you can make a qualified charitable distribution (QCD) from your Traditional, Roth, SIMPLE or inactive SEP IRA to one or more qualified charities.

Reasons to Request a QCD:

The QCD counts toward your RMD for the year.
You may donate up to a total of $100,000 in 2023, and $105,000 in 2024.
You’re not permitted to deduct the QCD as a charitable contribution, but since the distribution isn’t considered taxable income, it may help your tax bill. For example, if you keep your income low enough, your Social Security benefits will not be taxable (or will be taxed at a lower rate).

To request a QCD, complete a Required Minimum Distribution form and obtain a Medallion Signature Guarantee.