Hello from Sycamore,

If you are 73 or older and haven’t taken your Required Minimum Distribution (RMD) for the 2024 tax year, you will likely need to by year’s end.

What is an RMD?

An RMD is the minimum distribution you must withdraw from your retirement account each year.

When do I have to begin taking RMDs?

You must begin taking your RMDs on April 1st of the year following the calendar year in which you reach age 73. What does this mean?

  1. Example: Your 73rd birthday was anytime in 2023. As long as you will reach age 73 by December 31, 2023, you must take your first RMD (for 2023) by April 1, 2024.

Then each year after this you must take your RMD by December 31 of that year.

Can I take more than my RMD amount?

You can withdraw more than the minimum amount required. The total amount you withdraw will be included in your taxable income.

Can I take withdrawals before 73?

Yes. Once you reach 59 ½ you may take withdrawals with no early withdrawal penalty. You will still be responsible for regular income tax on the complete amount withdrawn.

You may also withdraw funds prior to age 59 ½ however, you will likely need to pay an extra 10% early withdrawal penalty in addition to the regular income tax.

Highlights for 2024

Retirement Savings Plan Contribution Limits have changed.

  1. 401(k), 403(b), 457 plans, and federal government Thrift Savings Plan contribution limits are $23,000.
    1. Catch-up contributions for those over age 50 are $7,500.
  2. IRA contribution limits increase to $7,000.
    1. Catch-up contributions for those over age 50 are $1,000.
  3. SIMPLE IRA contribution limits $16,000.
    1. Catch-up contributions for those over age 50 are $3,500.

As always, do not hesitate to reach out to our offices at (765) 455-1554 to discuss this.

Thank you for your continued trust and support,

Sycamore Financial Group

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