SECURE 2.0 Updates
Required Minimum Distributions
Over the next few years, the rules governing required minimum distributions (RMDs) will change. RPB will be notifying participants of these changes.
Effective immediately
Increased starting age. The age at which RMDs are payable has increased from 72 to 73 for participants turning 72 in 2023 or later and will increase to age 75 for participants turning 74 in 2033 or later. This helps participants who are closer to or at retirement keep their money in their tax-advantaged retirement account for longer.
Birth Year Age at Which RMD Begins 1950 or earlier
72 (70 1/2 for those who turned 70 1/2 prior to 2020) 1951 - 1959
73 1960 or later
75
Reduced penalties. The 50% excise tax imposed on recipients for late RMDs is now reduced to 25% and will be further reduced to 10% when a correction is made within a certain timeframe.
Effective January 1, 2024
No RMDs for Roth 403(b) balances. Roth 403(b) balances will no longer be subject to RMDs during a participant’s lifetime. (However, for retirees who reach age 73 in 2023, Roth account RMDs must still be made by April 1, 2024.)
Flexible start date for surviving spouses. The surviving spouse of a plan participant will be able to choose whether to use their own age or their deceased spouse’s age to determine when their RMDs will begin. This may be used to delay the start of RMDs and/or increase the period of time over which the surviving spouse receives payments.