The First-Year RMD Rule: Why You Might Face Two Required Distributions in One Year

Understanding the Basics of Required Minimum Distributions

For most of your working life, retirement accounts like traditional IRAs and 401(k)s offer a powerful advantage: the money inside them grows without being taxed year to year. But the IRS does not let that tax deferral last forever. At a certain age, the government requires you to begin withdrawing money from these accounts and paying income tax on those withdrawals. These mandatory withdrawals are called required minimum distributions, or RMDs.

The IRS generally says retirement account owners must begin taking RMDs in the year they reach age 73. This age threshold is the starting point for a set of timing rules that can surprise people who are new to the process, particularly in the very first year.

The First-Year Exception: April 1 of the Following Year

Here is where the rules become slightly different from what you might expect. While most RMDs must be taken by December 31 of the year they apply to, the IRS provides a special deadline for your very first RMD. For that initial distribution, the deadline can be April 1 of the year after you turn 73.

This extra window is sometimes called the "required beginning date." In practical terms, it means that if you turn 73 during a given year, you do not necessarily have to take that first withdrawal by the end of that same year. You can wait until as late as April 1 of the next year.

At first glance, this looks like a convenient bit of flexibility. And in some situations, it can be. But that extra time comes with a consequence that catches many retirees off guard.

Why You Could End Up With Two RMDs in One Year

The catch is this: delaying your first RMD does not delay your second one. The IRS notes that even if you push your first RMD into the following year, your second RMD is still due by December 31 of that same following year.

Consider how this plays out. Suppose you turn 73 in a particular year. You decide to use the first-year exception and wait to take your first RMD until April 1 of the next year. That satisfies the requirement for your first distribution. But the RMD for that second year is due by December 31 of that same second year. As a result, you end up taking two required distributions in the same calendar year: the delayed first one in early spring and the second one by year-end.

For some people, this timing is manageable. For others, it creates a problem that has nothing to do with the deadlines themselves and everything to do with taxes.

The Tax Consequence of Stacking Two Distributions

RMDs from traditional retirement accounts are generally treated as ordinary taxable income. When you take two RMDs in a single calendar year, you are reporting both amounts as income on that year's tax return. Stacking two distributions together can push your total taxable income higher than it would have been had you spread the withdrawals across two separate years.

A larger income figure in a single year can have ripple effects. It may move you into a higher tax bracket for that year. It can also affect other income-related calculations that matter to retirees, such as how much of your Social Security benefit is taxable or the income-based surcharges that apply to Medicare premiums. Because these effects depend on your overall financial picture, the decision about whether to delay your first RMD is worth thinking through carefully rather than treating it as an automatic choice.

Deadlines for Later Years

After the first year, the timing becomes more straightforward. The IRS says subsequent RMDs are generally due by December 31 each year. So once you are past that initial first-year decision, you settle into an annual rhythm: each year's required distribution must be completed by the final day of that year.

This is why the first-year rule stands out. It is the one moment where the April 1 option exists, and it is the only point at which the possibility of doubling up arises.

Different Rules for Certain Situations

It is important to understand that RMD rules are not one-size-fits-all. The IRS points out that different rules can apply to certain workplace plans, to beneficiaries who inherit retirement accounts, and to specific account situations.

For example, some people who are still working past age 73 and participating in an employer's retirement plan may have different timing considerations for that particular plan. Beneficiaries who inherit retirement accounts face their own separate set of distribution rules, which have changed significantly in recent years. And the type of account you hold can influence how the rules apply to you.

Because of these variations, the general framework described here is a starting point for understanding how RMDs work, not a substitute for reviewing the specific rules that apply to your own accounts.

The Takeaway

The first-year RMD timing rule offers a choice: take your first distribution by December 31 of the year you turn 73, or delay it until April 1 of the following year. The delay provides breathing room, but it can result in two taxable distributions landing in the same calendar year. Knowing this in advance allows you to weigh the timing against your broader income picture before the deadline arrives.