RMD Basics: What You Must Withdraw Starting at 73

A Required Minimum Distribution (RMD) is the minimum amount the IRS forces you to withdraw each year from a traditional 401(k), traditional IRA, SEP IRA, or SIMPLE IRA once you hit a specific age — currently 73 for most people approaching retirement now. Skip it, and the penalty is steep: a 25% excise tax on whatever you should have taken out.

For H1B and green card holders who’ve spent a career contributing to 401(k)s and IRAs, RMDs eventually apply the same way they do to anyone else — the account doesn’t know or care about your visa history. What’s different is what happens if you’ve since moved back to India, which is where a lot of the generic RMD content online quietly stops being useful.

When RMDs Actually Start

The RMD start age depends on your birth year, not a flat rule:

• Born 1951–1959: RMDs start at age 73.
• Born 1960 or later: RMDs start at age 75.

This age has shifted twice in the last few years — it was 70½ before 2020, moved to 72 under the first SECURE Act, then to 73 (with a future step to 75) under SECURE 2.0. If you’re reading a blog post or forum thread that mentions 70½ or a flat 72, it predates the current rule and the numbers in it can’t be trusted.

You get one piece of flexibility: your very first RMD can be delayed until April 1 of the year after you reach your RMD age, instead of by December 31 of the year you turn it. Every RMD after that is due by December 31.

How the Withdrawal Amount Is Calculated

The formula itself is simple — it’s just usually presented without a real number attached, which makes it feel more complicated than it is:

RMD = Account balance on December 31 of the prior year ÷ IRS life expectancy factor for your age

The life expectancy factor comes from the IRS Uniform Lifetime Table in Publication 590-B. A few reference points:

Age	Divisor
73	26.5
74	25.5
75	24.6
76	23.7

Worked example: Say your traditional IRA balance was $500,000 on December 31 of last year, and you turn 75 this year.

$500,000 ÷ 24.6 = $20,325.20

That’s the minimum you must withdraw this year. You can withdraw more if you want — the IRS only sets a floor, not a ceiling — but withdrawing less than $20,325.20 triggers the penalty on the shortfall.

Use the calculator below to run your own balance and age instead of doing the division by hand.

The Two-RMD Trap in Your First Year

The April 1 delay option sounds like a benefit, and it can be, but it has a specific consequence people don’t see coming: if you delay your first RMD to April 1, your second RMD is still due by December 31 of that same calendar year. That means two full distributions — both taxed as ordinary income — land in one tax year.

For someone whose income already sits near a bracket line, or whose Medicare premiums are tied to income (IRMAA surcharges), stacking two distributions in one year can push total taxable income high enough to cost more in tax and Medicare surcharges combined than it would have to just take the first RMD on time.

What Changed for Roth Accounts

Roth IRAs have never had RMDs for the original owner — that part hasn’t changed. What did change: starting in 2024, under SECURE 2.0, Roth 401(k) and Roth 403(b) accounts are also exempt from RMDs during your lifetime. Before 2024, Roth balances sitting inside an employer plan were still subject to RMDs even though Roth IRAs weren’t, which was a common point of confusion. If you’re consolidating old 401(k)s and deciding whether to roll a Roth 401(k) into a Roth IRA, this is one less reason to bother — the RMD exemption now applies either way.

If You’ve Moved Back to India

This is where RMDs stop being a US-only topic. If you built up a 401(k) or IRA during your H1B or green card years and have since returned to India — whether you’re now an NRI, hold OCI status, or gave up your green card — the RMD rules themselves don’t change. The IRS still expects the same withdrawal, by the same deadline, with the same 25% penalty for missing it.

What does change is withholding and logistics:

• Default withholding jumps. US custodians typically withhold at a flat 30% on distributions to a nonresident alien unless you’ve filed a current Form W-8BEN claiming a reduced rate under the US-India tax treaty.
• Custodians need a foreign address on file. Some brokerages restrict account access or flag accounts for review once they learn you’re living abroad, which can complicate taking the distribution on time in the first place.
• You still need a US bank account or transfer method to actually receive the RMD, since many custodians won’t wire directly to an Indian account without prior setup.
• It counts as foreign income in India too. RMDs typically need to be reported as foreign income on your Indian tax return, and if you’re a resident and ordinarily resident (ROR), potentially disclosed as a foreign asset under Schedule FA.

None of this cancels the US-side deadline. The IRS penalty clock doesn’t pause because you’re managing a custodian’s foreign-address paperwork from Bangalore.

What to Do Next

Run your own numbers in the calculator above using your actual account balance and age — it’ll show you the same division this article walked through, with your figures instead of the example. If you’re planning to move back to India before RMDs kick in, what happens to your 401(k)/IRA if you move back to India covers the account-level decision first — then it’s worth confirming your custodian can support a foreign address and getting a W-8BEN on file well before your first distribution is due, not after.

Educational estimate based on the IRS Uniform Lifetime Table — not tax advice. If you’re the beneficiary of an inherited IRA, different rules and a different table apply; consult a tax professional for your specific situation.