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Why the Required Beginning Date Is More Important than Ever

• What Is the RBD?
• The RBD and Annual RMDs During the 10-Year Period

• Other Reasons Why the RBD Is Now Important
• Conclusion

 

Executive Summary

The Often-Misunderstood “Rule of 55”

For those who have 401(k)s or other employee retirement plans (but not SEP or SIMPLE plans), the required beginning date (RBD) for when required minimum distributions (RMDs) are to begin is the same as for IRA owners – April 1 of the year after a person turns 72. However, if the plan allows for the “still-working exception,” the RBD can potentially be delayed if a worker is still working for the company where they have the plan. (Also, the worker cannot own more than 5% of the company in the year they reach age 72.)

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