How to Reduce Taxes on Your Required Minimum Distributions (RMDs)
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Four ways to reduce the tax on your RMDs
| Strategy | What it does | Who it's best for | Key limit |
|---|---|---|---|
| Qualified Charitable Distribution (QCD) | Sends IRA money directly to charity, excluded from taxable income, and counts toward your RMD | Charitably inclined retirees 70½+ | Up to $111,000/yr (2026, indexed) |
| Roth conversion before RMD age | Moves pre-tax dollars to a Roth now, shrinking the future RMD base | Anyone in a low-income "gap" year before RMDs start | Conversion is taxable in the year you do it |
| Withdrawal timing / bracket management | Spreads or times withdrawals to avoid jumping a bracket or IRMAA tier | Retirees near a tax-bracket or Medicare-surcharge threshold | Must still take the full RMD each year |
| Still-working exception | Delays RMDs from your current employer’s 401(k) until April 1 after the year you retire | People still working past RMD age who own 5% or less of the company | Does not apply to IRAs or old employers’ plans |
Figures reflect 2026 rules and the most recent published IRS limits; dollar caps are indexed for inflation and can change. Confirm current numbers before acting.
Look up your own divisor in the 2026 RMD table (the IRS Uniform Lifetime Table, ages 72 to 120).
Why RMDs can spike your bracket: the "tax torpedo"
For decades your traditional IRA and 401(k) grew tax-deferred. RMDs are how the IRS finally collects, and once they start (73, or 75 if born 1960 or later), they climb every year as a percentage of your balance. For retirees with sizable pre-tax accounts, that forced income can push you into a higher tax bracket, make more of your Social Security taxable, and trigger IRMAA surcharges that raise your Medicare Part B and D premiums. Advisors call this stacking effect the "tax torpedo": a single RMD can quietly raise the tax on several other parts of your income at the same time.
The most powerful move happens in your 60s
The biggest tax savings usually come from acting before RMDs ever begin. The years after you stop working but before age 73 are often your lowest-income years, and your lowest-bracket window. Filling up the lower brackets with Roth conversions during that gap moves money out of the pre-tax bucket permanently, so future RMDs are calculated on a smaller balance. Done steadily over several years, this can flatten the RMD curve and keep you below key thresholds later. Once RMDs are underway, QCDs and thoughtful withdrawal timing become the main levers.
These numbers change every year
The IRMAA brackets, the standard deduction and the senior deduction are all adjusted annually, and the 2027 figures are published late in 2026. The Social Security taxation thresholds are the one exception: those have not moved since 1983 and are not expected to.
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Check your own number
Three inputs, instant answer, nothing gated. The email step afterwards is optional.
| Provisional income | $0 |
| Which tier you land in | n/a |
| Share of benefit taxed | 0% |
We will email you a written copy showing how the math worked, what would change your tier, and the thresholds for next year. Free, and you can keep it or forward it to whoever does your taxes.
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See what your RMD will actually be
Enter your age and account balance, and our free RMD Calculator shows your required withdrawal and how it grows year by year, so you can plan the tax around it.
Estimate my RMD →Frequently asked questions
At what age do RMDs start, and how are they taxed?
RMDs from traditional IRAs and 401(k)s begin at 73, or 75 if you were born in 1960 or later, and every dollar is taxed as ordinary income at your regular rate. Roth IRAs have no RMDs during the original owner's lifetime, which is part of why Roth conversions can help.
What is a Qualified Charitable Distribution (QCD)?
If you're 70½ or older, a QCD lets you send up to $111,000 per year (2026 limit) directly from your IRA to a qualified charity. The gift counts toward your RMD but is left out of your taxable income, which can also help keep you under Social Security and IRMAA thresholds.
Can Roth conversions really lower my future RMDs?
Yes. Converted dollars are taxed now but are no longer subject to RMDs, so they shrink the pre-tax balance future RMDs are based on. Converting in your 60s, after work stops but before RMDs begin, is often the lowest-tax window to do it.
Want to run these numbers for your own situation?
The Retirement Literacy Foundation runs free retirement classes across Southern California on Social Security timing, taxes in retirement, and how to turn savings into income. No products are sold at our classes.
The Retirement Literacy Foundation is a 501(c)(3) non-profit. This guide is general financial education, not individualized investment, tax, or insurance advice. Figures are illustrative and change with tax law, inflation adjustments, and your personal situation. Consider speaking with a licensed professional before making decisions.
Hans Goldstein
Founder & Executive Director · Retirement Literacy Foundation, a 501(c)(3) non-profit
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