RMD deferral when switching jobs after reaching RMD age
Client of mine age 77 officially retiring from her job in September 2025. She has taken a new job which she recently began. If she rolls her 401k from the job she is retiring from into the 403b she has enrolled in for the new job – can she continue to defer taking her RMD from the first job. She is not a 5% or greater owner of either job.
Thanks
Howard
Permalink Submitted by Alan - IRA critic on Mon, 2025-06-02 12:36
Howard, the “still working” RMD exception only applies to the plan of the current employer. The Sept retirement will make 2025 an RMD distribution for the current plan.
After completing the 2025 RMD from the current plan, the balance could be rolled into the 403b of the new employer if the plan accepts rollovers from other qualified plans and client will not have any RMDs from the 403b as long as they continue working. In addition if the client also has an IRA, after completing the 2025 IRA RMD, the balance could also be rolled into the 403b and that would also eliminate IRA RMDs as long as client continues to work.
That said, unless client plans to continue working at least until early 2027, there is no point in doing these rollovers because if client retires any time before the end of 2026 there will be a 2026 403b RMD due and no RMDs will have been reduced.