Required Minimum Distributions: What Florida Retirees Need to Know

October 2, 2026

For most of your working life, the IRS lets your retirement accounts grow without asking for anything. That changes in your seventies. Once you reach a certain age, you have to start taking money out of most retirement accounts every year, whether you need the income or not. Those withdrawals are called required minimum distributions, or RMDs.

The rules are not complicated, but the deadlines are firm and the penalty for missing one is steep. Here is how RMDs work and what to think about before your first one arrives.

When RMDs start

Under current law, RMDs begin the year you turn 73. If you were born in 1960 or later, your starting age is 75.

Your first RMD has a little extra room. You can take it as late as April 1 of the year after you reach your starting age. Every RMD after that is due by December 31.

That April 1 option comes with a catch. If you wait, your first and second RMDs land in the same calendar year, and both count as income on that year’s tax return. For many people, taking the first one by December 31 of the year they turn 73 keeps things simpler.

Which accounts have RMDs

RMDs apply to:

Traditional IRAs, SEP IRAs, and SIMPLE IRAs
401(k), 403(b), and 457(b) plans
Most other employer retirement plans

Roth IRAs do not have RMDs while the original owner is alive. The same is now true of Roth accounts inside a 401(k) or 403(b).

If you are still working past your starting age, you can usually delay RMDs from your current employer’s plan until you retire, unless you own 5% or more of the business. That exception does not cover IRAs or plans left behind at former employers.

How the amount is calculated

The math uses two numbers: your account balance on December 31 of the prior year, and a life expectancy factor from an IRS table. Divide the first by the second.

Most people use the IRS Uniform Lifetime Table. At age 73 the factor is 26.5. So a traditional IRA worth $500,000 at the end of last year would have an RMD of about $18,868 this year. The factor gets smaller each year, which means the percentage you must withdraw rises as you age.

If you have more than one account, the rules differ by type:

IRAs: calculate the RMD for each, then take the total from any one or a combination of them.
403(b) accounts: same approach as IRAs.
401(k) and 457(b) plans: each plan’s RMD has to come out of that plan.

Your account custodian will usually calculate the figure for you, and our financial calculators can give you an estimate. It is still your responsibility to make sure the full amount comes out on time.

What happens if you miss one

The IRS charges an excise tax of 25% of the amount you should have withdrawn and did not. If you correct the mistake within two years, the tax drops to 10%. Either way, it is an expensive oversight, and it is on top of the regular income tax you will owe on the withdrawal itself.

What is different for Florida retirees

Florida has no state income tax, so your RMDs are taxed only at the federal level. That is a real advantage over retirees in many other states. It does not make RMDs tax-free.

RMDs from traditional accounts count as ordinary income, and a larger income can have side effects:

More of your Social Security benefit may become taxable. See our article on deciding when to take Social Security.
Your Medicare Part B and Part D premiums can rise, because those premiums are tied to the income on your tax return from two years earlier. Our Medicare overview explains how enrollment works.

Public employees have one more thing to watch. If you rolled a lump sum from the Florida Retirement System’s Deferred Retirement Option Program (DROP) into an IRA, that IRA follows the same RMD rules as any other. The same goes for balances in the FRS Investment Plan.

Ways to plan ahead

You cannot avoid RMDs, but you have choices about how they affect you. A few that are worth discussing with your advisor and tax professional:

Qualified charitable distributions. Starting at age 70½, you can send money from an IRA directly to a qualified charity. For 2026 the limit is $111,000 per person. Once RMDs apply to you, a qualified charitable distribution can count toward that year’s requirement, and the amount is left out of your taxable income.

Roth conversions before RMDs begin. Moving money from a traditional account to a Roth account means paying income tax on the amount converted now. In exchange, that money is no longer subject to RMDs during your lifetime. Whether it makes sense depends on your current and expected future tax brackets.

Timing and withholding. You can take your RMD in one payment or spread it through the year, and you can have federal tax withheld from it. Some retirees use withholding from a year-end RMD to cover their tax bill for the year.

Coordinating withdrawals. Which accounts you draw from first, and when, affects your taxes over the whole of retirement. This is where a written income plan earns its keep. Our tax strategies page covers how we approach it.

Inherited accounts follow different rules

If you inherit a retirement account, the schedule depends on your relationship to the original owner and when they died. Many non-spouse beneficiaries must empty the account within ten years, and some must also take annual withdrawals along the way. Ask before you move any money. Mistakes with inherited accounts are hard to undo.

The bottom line

RMDs are a fixed part of retirement for anyone with traditional retirement accounts. The people who handle them well tend to start planning a few years before the first one is due, when there is still time to adjust.

If you are within five years of your starting age, it is a good time to look at how RMDs fit into your retirement plan. Talk to an advisor at Signature Financial Solutions and we will walk through your numbers with you.

This material is for general information only and is not intended to provide specific tax or legal advice. Tax laws are complex and subject to change. Please consult a qualified tax professional about your individual situation. Converting from a traditional IRA to a Roth IRA is a taxable event.