Knowing how to avoid RMDs starts with one rule: once you reach your required beginning date, the current year’s required minimum distribution cannot be skipped, rolled over, or converted, so the practical focus is reducing or offsetting future RMDs before they start. The legal levers retirees commonly weigh include Roth conversions before age 73, Qualified Charitable Distributions, Qualified Longevity Annuity Contracts, and the still-working exception for a current employer’s plan.
You cannot legally skip an RMD once it is due, but you may reduce future RMDs by converting traditional IRA dollars to Roth before age 73, and you may offset the tax with a Qualified Charitable Distribution, which for 2026 lets IRA owners age 70½ or older exclude up to $111,000 from taxable income while counting toward the RMD (Source: IRS Notice 2025-67, 2025).
Can you actually avoid an RMD, or only reduce it?
You cannot avoid a required minimum distribution that is already due for the current year. Under IRS rules an RMD is not an eligible rollover distribution, so it cannot be rolled over or converted, and if it is not taken it may be subject to an excise tax (Source: IRS, Retirement plan and IRA required minimum distributions FAQs, 2025). What retirees can influence is the size of future RMDs and the tax those distributions trigger.
Talk With Craig Wear's Team
Craig has helped IRA millionaires save over $1 million each in unnecessary taxes. Find out if a Roth conversion strategy fits your retirement, with no sales pressure and no product pitch.
The strategies below fall into three buckets, and they are often confused with one another. Some approaches genuinely avoid a future RMD on specific dollars, some reduce the balance that future RMDs are calculated on, and some only offset the income tax without changing the RMD itself. Sorting a strategy into the right bucket is what makes its effect clear.
| Strategy | What it does | Effect on the RMD |
|---|---|---|
| Roth conversion before age 73 | Moves pre-tax dollars to a Roth account with no lifetime RMDs | Reduces future RMDs (converted dollars no longer counted) |
| Qualified Charitable Distribution | Sends IRA money directly to charity, excluded from income | Satisfies (offsets) the RMD; does not eliminate it |
| Qualified Longevity Annuity Contract | Defers RMDs on that money to as late as age 85 | Reduces near-term RMDs on the sheltered amount |
| Still-working exception | Delays RMDs from a current employer’s plan | Reduces (defers) RMDs on that plan only |
| Strategic pre-RMD withdrawals | Draws down the balance in low-income years | Reduces future RMDs by shrinking the balance |
For the underlying rules, divisor tables, and 2026 penalty figures, see our reference page on required minimum distributions for 2026. This guide focuses on the how-to of reducing and offsetting them.
At what age do RMDs start, and why timing matters
RMDs generally must begin at age 73 for people who reach age 72 after December 31, 2022 (Source: IRS, Retirement topics, Required minimum distributions, 2025). The first RMD is due by April 1 of the year following the year you turn 73, called the required beginning date, and every subsequent RMD is due by December 31 (Source: IRS Pub 590-B, 2025). Timing shapes which strategies remain available to you.
Under the SECURE 2.0 Act, the applicable age rises to 75 for an individual who attains age 74 after December 31, 2032 (Source: SECURE 2.0 Act of 2022, Sec. 107, Pub. L. 117-328). The years between retirement and the required beginning date, often called gap years, tend to be lower-income windows before Social Security and RMDs stack on top of each other. Roth conversions, discussed below, are one tool some retirees consider during that window, because a conversion cannot include an RMD once distributions have started.
Which accounts are subject to RMDs
RMDs apply to traditional IRAs, SEP and SIMPLE IRAs, and employer plans such as 401(k), 403(b), and profit-sharing plans (Source: IRS, RMD comparison chart, 2025). Roth IRAs have no lifetime RMDs for the original owner, and under SECURE 2.0, designated Roth accounts inside a 401(k) or 403(b) are no longer subject to RMDs during the owner’s lifetime (Source: IRS, Retirement topics, RMDs, 2025). Knowing which accounts count tells you where the strategies apply.
Strategy 1: Convert traditional dollars to Roth before age 73
Converting traditional IRA or 401(k) dollars to a Roth account before age 73 reduces the pre-tax balance on which future RMDs are calculated, because Roth IRAs carry no lifetime RMDs for the original owner (Source: IRS Pub 590-B, 2025). The conversion is taxable in the year received, so it trades a tax bill now for smaller or eliminated RMDs later (Source: IRS Pub 590-A, 2025). The result depends on individual circumstances.
One approach retirees weigh is converting during pre-RMD, pre-Social-Security gap years, when other income may be lower. Because the conversion amount interacts with your bracket, other income, and time horizon, these are individual calculations rather than a fixed rule, and the appropriate amount varies by person.
Sequencing matters after your required beginning date. The year’s RMD must be taken first and cannot itself be converted, since an RMD is not an eligible rollover distribution. That ordering rule is a factor in why conversions aimed at reducing RMDs are often evaluated before age 73. You can learn more about our Roth conversion planning approach and review published Roth conversion statistics for 2026.
Strategy 2: Use Qualified Charitable Distributions to offset the tax
A Qualified Charitable Distribution, or QCD, lets an IRA owner age 70½ or older transfer money directly from an IRA to a qualified charity, excluding that amount from gross income while it counts toward satisfying the RMD (Source: IRS Pub 590-B, 2025). For 2026 the annual QCD exclusion limit is $111,000 per individual, increased from $108,000 in 2025 (Source: IRS Notice 2025-67, 2025). It offsets tax without removing the RMD itself.
A QCD does not eliminate the RMD. It satisfies the RMD while keeping the amount out of taxable income, which is one reason charitably inclined retirees may compare it to taking the distribution and claiming an itemized deduction. Because the money never enters adjusted gross income, a QCD can also affect income-driven thresholds discussed below.
SECURE 2.0 also created a one-time election to fund a split-interest entity such as a charitable remainder trust or charitable gift annuity through a QCD. For 2026 that one-time limit is $55,000, increased from $54,000 in 2025 (Source: IRS Notice 2025-67, 2025).
Donor-advised funds as an alternative
A donor-advised fund, or DAF, is a charitable-giving account that can produce an itemized deduction in the funding year. IRS rules do not permit QCDs to be made to a donor-advised fund (Source: IRC Section 408(d)(8)(B); IRS Pub 590-B, 2025). A DAF therefore offsets RMD-driven income through a deduction rather than an exclusion, a different mechanism with different tax effects depending on whether you itemize. Which fits depends on your deduction situation and giving goals.
Strategy 3: Defer part of the balance with a QLAC
A Qualified Longevity Annuity Contract, or QLAC, is a deferred annuity funded from an IRA or 401(k) that can push required distributions on that money to as late as age 85, removing the sheltered amount from the RMD calculation until payments begin (Source: Treas. Reg. 1.401(a)(9)-6, 79 Fed. Reg. 37633, 2014). This reduces near-term RMDs on the dollars placed in the contract while providing later-life income.
QLACs carry a lifetime premium limit set by the IRS and indexed for inflation. SECURE 2.0 raised that limit from $125,000 to $200,000, subject to future inflation adjustment (Source: SECURE 2.0 Act of 2022, Sec. 202, Pub. L. 117-328), and for 2026 the premium limit remains $210,000 (Source: IRS Notice 2025-67, 2025). Because a QLAC converts liquid savings into a future income stream, it is a long-horizon tool rather than a way to touch a current-year RMD. Suitability depends on longevity expectations, liquidity needs, and other income.
Strategy 4: Use the still-working exception (current employer only)
If you are still employed and are not a 5% owner of the company, you may be able to delay RMDs from that current employer’s qualified plan until April 1 following the later of the year you turn 73 or the year you retire, provided the plan permits it (Source: IRS, RMD comparison chart, 2025). This exception applies only to the plan of the employer you currently work for, not to your other accounts.
The limits are strict. The still-working exception does not apply to IRAs, where RMDs begin at 73 even if you are still employed. It does not apply to former-employer plans, and it does not apply to 5% owners, who must start RMDs by April 1 of the year following the year they turn 73 (Source: IRS, RMD comparison chart, 2025). Some workers consider rolling old plans into the current 401(k) so those dollars fall under the exception, if the plan accepts rollovers.
Strategy 5: Take strategic withdrawals in low-income years
Taking larger voluntary distributions during low-income early-retirement years can shrink the pre-tax balance so that future RMDs, and the taxes on them, are smaller. Because a required minimum distribution is based on the account balance, a lower balance in later years produces a lower required amount (Source: IRS Pub 590-B, 2025). The effect depends on your bracket and time horizon.
This lever pairs with Roth conversions during gap years, since both aim to move income into lower-income years before RMDs and Social Security stack up. The tradeoff is paying tax earlier, so the value depends on your current versus expected future bracket and how long the funds can grow.
The income thresholds high-balance retirees weigh
For retirees with large pre-tax balances, RMDs raise questions beyond the distribution itself, because RMD income is ordinary income and stacking it on Social Security and other income can affect several tax thresholds at once. The items below are general factors to weigh, and each applies differently by individual circumstances and filing status, so they are worth reviewing case by case.
- IRMAA Medicare surcharges. Higher modified adjusted gross income may trigger income-related monthly adjustment amounts on Medicare Part B and Part D premiums. See our page on Medicare IRMAA 2026 brackets and premiums.
- Filing status after a spouse dies. A surviving spouse often files as single in later years, which can compress the same RMD income into narrower brackets.
- Capital-gains and net investment income tax. RMD income may affect where long-term capital gains are taxed and whether the net investment income tax applies. See net investment income tax for 2026.
- Social Security taxation. Rising ordinary income may increase the taxable portion of benefits, a dynamic covered in our Social Security tax torpedo explainer.
Because a QCD keeps income out of AGI and a Roth conversion moves future income out of the taxable column, these strategies are sometimes evaluated for their effect on these thresholds, not only the RMD line. The interactions are individual and generally worth modeling before acting.
Which strategy fits which situation?
No single lever fits everyone, and the appropriate choice tends to track age, balance, and charitable intent. The matrix below is a general framework, not a recommendation, and the right approach depends on your full tax picture. Each row lists an approach some retirees in that situation consider, with the reason it is commonly raised.
| Situation | Approach often considered | Why |
|---|---|---|
| Age about 60 to 67, retired, low current income | Roth conversions and strategic withdrawals in gap years | Lower-income years before RMDs and Social Security stack |
| Age about 68 to 72, approaching the required beginning date | Final Roth conversions; a QLAC in some cases | Window to convert before RMDs and to defer part of the balance |
| Age 73+, charitably inclined | Qualified Charitable Distributions | Satisfies the RMD while excluding up to $111,000 (2026) from income |
| Still working, not a 5% owner | Still-working exception on current plan | Delays RMDs from that employer’s plan if it permits |
What happens if you miss an RMD
Missing an RMD can be costly, which is why the deadlines matter. If distributions are not taken or are too small, the IRS may impose a 25% excise tax on the amount not distributed as required, reduced to 10% if the shortfall is withdrawn within a two-year correction window (Source: IRS, Retirement plan and IRA required minimum distributions FAQs, 2025). Under SECURE 2.0 this replaced the prior 50% penalty.
A missed RMD is reported on Form 5329, which is also used to request a waiver for reasonable error (Source: IRS, Retirement plan and IRA required minimum distributions FAQs, 2025).
Work with Q3 Advisors
Q3 Advisors is a registered investment adviser focused on retirement tax planning. This article is educational and is not advice; for guidance on your own circumstances, consult a qualified tax or financial professional.
Frequently asked questions
Can I avoid taking RMDs if I’m still working?
Possibly, but only for your current employer’s qualified plan. If you are still employed and are not a 5% owner, you may delay RMDs from that plan until April 1 after the later of the year you turn 73 or the year you retire, if the plan allows (Source: IRS, RMD comparison chart, 2025). The exception does not apply to IRAs or to former-employer plans, which follow the standard rules.
What is the penalty for not taking your RMD?
If you do not take the full RMD, the IRS may apply a 25% excise tax on the amount not distributed as required, reduced to 10% if you correct the shortfall within two years (Source: IRS, Retirement plan and IRA required minimum distributions FAQs, 2025). SECURE 2.0 lowered this from the prior 50% tax. The shortfall and any waiver request are reported on Form 5329, filed with your federal return.
At what age do RMDs start?
RMDs generally start at age 73 for those who reach age 72 after December 31, 2022 (Source: IRS, Retirement topics, RMDs, 2025). Your first RMD is due by April 1 of the year after you turn 73, and later RMDs are due by December 31 each year (Source: IRS Pub 590-B, 2025). Under SECURE 2.0, the applicable age rises to 75 in 2033.
How do I roll over my RMD to a qualified charity?
An RMD cannot be rolled over, but IRA owners age 70½ or older can make a Qualified Charitable Distribution by having the IRA custodian send funds directly to a qualified charity. For 2026, up to $111,000 per individual can be excluded from income and counted toward the RMD (Source: IRS Notice 2025-67, 2025). QCDs cannot be made to a donor-advised fund (Source: IRC Section 408(d)(8)(B)).
Can I convert my RMD to a Roth IRA?
No. An RMD is not an eligible rollover distribution, so it cannot be converted to a Roth IRA. If you are past your required beginning date, you must take the year’s RMD first, and only amounts beyond the RMD may be converted (Source: IRS Pub 590-A, 2025). Converting before age 73 is one way retirees avoid this ordering constraint, depending on their circumstances.
Do 403(b) plans have required minimum distributions?
Yes. Traditional 403(b) plans are subject to RMDs, along with 401(k), profit-sharing, traditional IRA, SEP, and SIMPLE IRA accounts (Source: IRS, RMD comparison chart, 2025). Under SECURE 2.0, however, designated Roth accounts inside a 403(b) or 401(k) are no longer subject to RMDs during the owner’s lifetime (Source: IRS, Retirement topics, RMDs, 2025), which changes where the account sits.
Can I reinvest my required minimum distribution?
You cannot return an RMD to a tax-advantaged retirement account, because it is not eligible for rollover, but you can reinvest the after-tax proceeds in a taxable brokerage account. If you have earned income and are eligible, you may separately contribute to an IRA, which for 2026 is limited to $7,500, plus a $1,100 catch-up at age 50 or older (Source: IRS Notice 2025-67, 2025). See our retirement contribution limits for 2026.
How much tax should I withhold from my RMD?
RMDs are generally taxed as ordinary income, and custodians can withhold federal tax at your election. The right amount depends on your total income, bracket, and other withholding or estimated payments. Because RMD income can raise your marginal rate or affect thresholds such as IRMAA, the appropriate withholding varies by individual circumstances, so many retirees review it each year.
Sources
IRS, Retirement topics, Required minimum distributions (RMDs), 2025: https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-required-minimum-distributions-rmds
IRS, Retirement plan and IRA required minimum distributions FAQs, 2025: https://www.irs.gov/retirement-plans/retirement-plan-and-ira-required-minimum-distributions-faqs
IRS, RMD comparison chart (IRAs vs. defined contribution plans), 2025: https://www.irs.gov/retirement-plans/rmd-comparison-chart-iras-vs-defined-contribution-plans
IRS Publication 590-B, 2025: https://www.irs.gov/publications/p590b
IRS Publication 590-A, 2025: https://www.irs.gov/publications/p590a
IRS Notice 2025-67 (2026 amounts relating to retirement plans and IRAs), 2025: https://www.irs.gov/pub/irs-drop/n-25-67.pdf
SECURE 2.0 Act of 2022, Public Law 117-328, Sections 107 and 202: https://www.congress.gov/117/plaws/publ328/PLAW-117publ328.pdf
Internal Revenue Code Section 408(d)(8) (qualified charitable distributions): https://www.law.cornell.edu/uscode/text/26/408
Treasury Regulation 1.401(a)(9)-6, Longevity Annuity Contracts, 79 Fed. Reg. 37633 (July 2, 2014): https://www.federalregister.gov/documents/2014/07/02/2014-15524/longevity-annuity-contracts
