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USAA Life Insurance Company and USAA Life Insurance Company of New York

Understand your required minimum distribution. 

What are required minimum distributions?

When you turn 73, you’ll have to start taking out a certain amount of money each year from your retirement plan. That amount is a required minimum distribution, or RMD.

Watch to learn more about RMDs and how they work.

Types of retirement plans that require RMDs

Here are some of the most common tax-qualified plans that may need RMDs:

  • Individual retirement accounts, or traditional IRAs

  • Simplified Employee Pensions, or SEP IRAs

  • Tax-sheltered annuities, or TSAs

  • Optional Retirement Plans, or ORPs

  • State deferred compensation, or SDC

  • Keogh and individual retirement rollovers

  • Employer-sponsored retirement plans such as 401(k), 403(b), 457(b) and profit-sharing plans. You may be able to postpone RMDs until after retirement. Check with your plan's administrator for more details.

When aren't they required?

An RMD may not be required in some situations, including owning a Roth IRA while the owner is alive or working past age 73. Contact us with questions or talk to your tax advisor.

How to calculate RMDs

We’ll give you the RMD amount for the retirement plans you have with us, but you may have others. The IRS usually requires you to calculate separate RMDs for each qualified plan.

Calculate RMDs

When you should take an RMD

For most types of qualified retirement plans, you must take an RMD in the year you turn 73 or choose to delay your first RMD until April 1st of the following year. Then you must take another RMD by the end of that year and each year thereafter.

 

For example, if you turn 73 in 2024, you must take your first RMD by April 1, 2025. Then you must take an additional RMD again that year — and each year after that — by Dec. 31.          

What happens if you don’t take an RMD?

If you miss a withdrawal or take out too little, the IRS may impose a 25% penalty tax on the amount you didn’t take.

 

For example, say your RMD is $10,000 for the year and you only take $5,000. The IRS may impose a penalty of $1,250 on the remaining $5,000, plus any other taxes you owe on the RMD.

How to take your RMD

These are the items you’ll need to complete to take your RMD. Once completed, you can send the forms back to us by uploading them to usaa.com or our app.

If you’d like to mail in your forms, review page 1 of the USAA RMD Guide, Opens new window.

Call our insurance professionals.

To set up your RMD, you can call 800-531-LIFE (5433). Phone requests are limited to a direct check disbursement to you, not a third party, and don’t allow tax withholding changes.

If your needs are outside of these limitations, complete the USAA RMD guide and required tax forms.

Complete the USAA RMD Guide.

If you want to set up or make changes to your RMD, download and fill out our guide, Opens new window. We must receive it no later than Dec. 20 of the current year.

Complete required tax forms.

If you want to change or opt out of the standard tax withholding amount, download and fill out IRS Form W-4R , Opens new window.

You can do the same for state taxes, but forms vary depending on where you live. Talk to your tax advisor for more guidance. 

RMD FAQ

When you complete your RMD Guide, you can select one of these options to get your payment:

  • Have the money deposited into your non-IRA annuity or life insurance policy.
  • Get a check mailed to you or your charity of choice.
  • Set up an Electronic Funds Transfer to your checking or savings account with USAA or other financial institution.

Other RMD resources

Required minimum distributions, or RMDs: What you need to know

Article: 9 minutes

Read article: Required minimum distributions, or RMDs: What you need to know

Are you going through your retirement savings too quickly?

Article: 6 minutes

Read article: Are you going through your retirement savings too quickly?

A paycheck that can last for life

Article, Video: 4 minutes

Read article: A paycheck that can last for life

Need more help?

We understand RMDs can be confusing. Our financial professionals are here for you. 

Call 210-531-USAA (8722)

For TTY devices, dial