Quick Read – Workers still employed by their 401(k) sponsor who own 5% or less of the company can delay RMDs indefinitely past age 73. – Skipping forced RMDs keeps reported income lower, shielding Social Security from the 85% taxable threshold and avoiding higher Medicare IRMAA…
emiums. – Rolling old 401(k)s into the current employer’s plan before turning 73 extends the RMD shelter over a much larger balance. – She is 69, has been at the same company for decades, and has zero interest in retiring. Her paycheck still arrives every two weeks, her 401(k) keeps compounding, and her Social Security check lands on top of it
The boomer instinct to work runs deep, even as headlines about AI reshaping offices push some peers toward earlier exits. One online thread captured the worry well: a woman loved her work, did not want to retire, and could not figure out whether staying employed would help or hurt her tax picture once mandatory retirement account withdrawals kicked in. The answer turns out to be unusually generous to people who keep working past age 73.
The Rule That Rewards Staying on the Payroll Required minimum distributions (RMDs), the forced annual withdrawals the IRS pulls from pre-tax retirement accounts, begin at age 73 for anyone born between 1951 and 1959, and at age 75 for anyone born in 1960 or later. At 69, she is not there yet. The rule that matters sits a few years out: if she is still employed by the company that sponsors her 401(k), and she does not own more than 5% of that business, she can delay required withdrawals from that specific plan for as long as she stays on the payroll.