401(k) Required Minimum Distribution

You have been deferring taxes in the traditional (before-tax) portion of your 401(k) to help it grow throughout your career and the government wants to start taxing that account by your required age (see below).

• Age 70 ½ if you were born on June 30, 1949, or earlier
• Age 72 if you were born between July 1, 1949, and December 31, 1950
• Age 73 if you were born between January 1, 1951, and December 31, 1959
• Age 75 if you were born on January 1, 1960, or later

If you are working beyond these ages, you do not have to take an RMD from DMBA until you retire.

Your RMD is equal to your before-tax account balance on December 31 of the previous year divided by your age-based distribution period from the IRS Uniform Lifetime Table. For example, if:

• your before-tax 401(k) balance was $200,000 on December 31, 2023,
• you are married,
• your spouse, who is the sole beneficiary of your 401(k), is less than 10 years younger than you, and
• you turn 74 in 2024,
• then your distribution period is 25.5 and your RMD for 2024 would be $7,843 ($200,000/25.5). Although this is the minimum amount you are required to withdraw, you can withdraw more. For DMBA 401(k) Plan accounts, the Roth portion is not included in the previous year’s balance.

You will receive a letter labeled “Action Required” from Empower Retirement in the fall of the year that your first withdrawal is required. The letter will include the amount of your RMD and when it is due. Please follow the instructions in this letter to be sure your RMD is distributed by the due date.

In the first year, you will have until April 15 of the following year to take your distribution. For all subsequent years, the RMD must be distributed by December 31. If you choose to wait until April 15 of the following year for your first RMD, you will have a second RMD for the second year also due that year by December 31. The two distributions in one year will both count as ordinary income.

If you have questions about your RMD, please call DMBA Member Services at 801-578-5600.

If an account owner fails to withdraw the full RMD amount by the due date, the owner is subject to an excise tax equal to 25% of the amount not withdrawn or 10% if corrected within two years.

Distributions from the traditional (before-tax) portion of your 401(k) will count as ordinary income. You can have taxes withheld at the time of the distribution by completing IRS Form W-4P. You will receive a Form 1099-R at the end of the year showing the amounts distributed and withheld. Use this form to complete your tax return.

If you have questions about tax withholding, please call DMBA Member Services at 801-578-5600.

No. Beginning in 2024, there is no RMD for the Roth portion of your 401(k).