New legislation left RMD requirements intact, forcing withdrawals of $56,604 at age 73 for traditional 401(k) balances of $1.5 million.
Retirees with $1.5 million in traditional 401(k) or IRA accounts will face a mandatory $56,604 withdrawal in 2026 under unchanged RMD rules. The recently passed legislation preserved existing requirements, disappointing those expecting relief from forced distributions.
RMDs begin at age 73 for individuals born between 1951 and 1959, and at 75 for those born in 1960 or later. The withdrawal amount is calculated using IRS life-expectancy tables, regardless of financial need or lifestyle. Prior legislation, SECURE 2.0, had set these rules, which remain unaltered.
Strategies to mitigate RMD tax exposure include Roth conversions in one’s 60s, Qualified Charitable Distributions up to $111,000, and relocating to states with no income tax. Delaying Roth conversions until age 72 is cited as a costly mistake, as it layers conversions atop mandatory RMDs.