Retirement Planning & RMD Calculators

Planning Your Retirement Withdrawals: Why the Order and Amount Matter

One of the most consequential decisions a retiree makes is not when to claim Social Security — it is how to manage withdrawals from multiple accounts (IRA, 401(k), Roth, taxable brokerage) in a way that minimizes lifetime tax liability, avoids Medicare surcharges, and satisfies IRS Required Minimum Distribution rules. Getting this wrong by even one large withdrawal can cost thousands in taxes and trigger IRMAA surcharges that follow you for two full years.

Required Minimum Distributions: The Deadline You Cannot Miss

The IRS requires that you begin withdrawing from traditional IRAs and most employer-sponsored plans (401(k), 403(b), 457(b)) by April 1 of the year after you turn 73. After that, you must take distributions each year by December 31. If you miss an RMD or withdraw less than the required amount, the IRS imposes a penalty of 25% of the shortfall — reduced to 10% if you correct it within two years.

Use our RMD Calculator to find your exact required withdrawal for the current year based on your account balance and the official IRS Uniform Lifetime Table (Publication 590-B).

Roth Conversions: The Window Between Retirement and RMDs

The years between retirement and age 73 (when RMDs begin) often represent a window of lower taxable income. Converting traditional IRA funds to a Roth IRA during this window — and paying tax on the conversion at today's lower rates — can reduce future RMDs, lower Medicare IRMAA exposure in later years, and provide tax-free income for heirs.

The tradeoff is that conversion income in a given year raises your MAGI, which determines Medicare Part B and Part D premiums two years later. Use our Roth Conversion Calculator to model the tax impact before you convert, and our MAGI for Medicare Calculator to check whether a planned conversion would push you into a higher IRMAA bracket.

State Taxes on Retirement Income

Federal tax is only part of the picture. Thirty-eight states tax at least some retirement income, but many have generous exemptions for Social Security, pensions, or retirement account withdrawals for residents over 65. If you are considering relocation, the differences can be substantial — some states tax none of your retirement income while others treat all sources the same as wage income.

Our Retirement Tax Calculator by State compares federal plus state tax across all 50 states for your specific income mix.