At what age do RMDs start and why does that matter?

Under current law, required minimum distributions generally begin at age 73. Once they start, you must withdraw a growing percentage of your tax-deferred accounts each year whether you need the money or not. That forced income is what sets off the torpedo, which is why the years before 73 (often your 60s) are the key planning window.

How do Roth conversions defuse the tax torpedo?

Roth conversions move money out of tax-deferred accounts (which are subject to RMDs) and into a Roth (which is not) while you may be in a lower bracket in your 60s. This shrinks the future account balance the RMD is calculated on, so future RMDs are smaller. Smaller RMDs mean less pressure on Social Security taxation and IRMAA later. It is general education, not individualized tax advice.

Retirement Literacy Foundation · Educational Guide

The RMD Tax Torpedo: How Withdrawals Push You Into a Higher Bracket

Q: What is the RMD tax torpedo?

The RMD tax torpedo is the stacking effect that happens when required minimum distributions (RMDs), which begin at age 73, raise your reported income enough to make more of your Social Security benefits taxable and, at higher incomes, trigger IRMAA surcharges on your Medicare premiums. Because a single dollar of RMD can pull in multiple hidden taxes at once, your true marginal tax rate can climb well above your stated bracket.

Short answer: The "tax torpedo" happens when required minimum distributions (RMDs, starting at age 73) raise your income enough to make more of your Social Security taxable and trigger IRMAA Medicare surcharges at the same time. The two stack up and can push your true marginal tax rate well above your stated bracket. The fix is to act in your 60s: Roth conversions before RMDs begin shrink the future RMD base and defuse the torpedo.

How one RMD dollar stacks into several taxes

Step	What happens	Effect on your taxes
1. RMD begins at 73	You must withdraw a set % of tax-deferred accounts	Adds fully taxable ordinary income
2. Social Security recalculated	Higher income raises your "provisional income"	Up to 85% of benefits become taxable
3. IRMAA threshold crossed	Income tips past a Medicare bracket line	Part B & D premium surcharges kick in
4. True cost of that dollar	Stated bracket + extra SS tax + IRMAA	Effective rate well above your bracket

Illustrative for 2026 rules; RMDs generally begin at age 73 under current law. The exact stacking depends on your income, filing status, and Medicare enrollment. Estimate yours below.

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Why the torpedo hits middle-income retirees hardest

You might expect this to be a "wealthy person" problem, but the sharpest sting often lands on middle-income retirees. The reason is the Social Security taxation formula: as your other income rises through a certain band, each additional dollar of RMD can make roughly 50 to 85 cents of a Social Security dollar taxable too. So a retiree in the 12% bracket can face a real marginal rate closer to 22% or more on part of that income, even before IRMAA is counted. Higher earners are already taxing 85% of their benefits, so for them the "more SS taxable" lever is largely pulled; it's the middle that gets caught mid-ramp.

The 60s conversion window: your best chance to defuse it

The years between retiring and age 73 are often a low-income valley. You've stopped working but haven't started RMDs or, sometimes, Social Security. That valley is prime time for Roth conversions: you move money from tax-deferred accounts (which feed RMDs) into a Roth (which has no RMDs for the original owner), paying tax now at what may be a lower rate. Every dollar converted shrinks the future balance your RMD is calculated on, which shrinks future RMDs, which eases the pressure on Social Security taxation and IRMAA down the road. Done gradually, "filling up" a lower bracket each year, this can meaningfully soften the torpedo, or in some cases sink it before it ever fires.

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Frequently asked questions

What is the RMD tax torpedo?

It's the stacking effect when required withdrawals (starting at 73) raise your income enough to make more of your Social Security taxable and trigger IRMAA Medicare surcharges at once. One RMD dollar can pull in several hidden taxes, so your true marginal rate climbs above your stated bracket.

At what age do RMDs start, and why does timing matter?

Under current law, RMDs generally begin at age 73. Once they start, you must withdraw a growing percentage each year whether you need it or not. That forced income sets off the torpedo, which is why the years before 73 (often your 60s) are the key window to plan ahead.

How do Roth conversions help?

Converting tax-deferred money to a Roth in your 60s, often at a lower bracket, shrinks the balance your future RMDs are based on. Smaller RMDs mean less pressure on Social Security taxation and IRMAA later. This is general education, not individualized tax advice.

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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, interest rates, 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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