22 May What’s the penalty if you mess up your IRA distribution?

Q. Someone said there is a 50% penalty if you don’t take a large enough Required Minimum distribution (RMD). Is that really true? How do you figure out your RMD so you don’t mess it up?
— Taxpayer

A. The rules have changed in recent years.

But you still don’t want to mess it up.

The good news is that with the passing of the Secure 2.0 Act, beginning with tax years starting in 2023 (and after), the penalty for failing to take your full Required Minimum Distribution (RMD) was reduced from 50% down to 25%, said Howard Milove, a certified public accountant senior wealth advisor with Access Wealth in East Hanover.

“In some cases, you may be able to further reduce the penalty to 10% if the mistake is corrected within two years,” he said. “The IRS may even waive the penalty completely if there was a reasonable cause for the error.”

However, if you don’t properly satisfy the RMD requirement, the excise tax penalty will continue to be assessed each year until the correct amount is withdrawn, he said.

Most custodians will calculate your RMD for you, but you are ultimately responsible for making sure the calculation is correct and taking the distribution, Milove said.

He offered this example of how to calculate your RMD:

To calculate your 2026 RMD, you will need to know the balance in your account as of Dec. 31, 2025 and divide it by the proper life expectancy factor (based on your age in that year) listed on the IRS Uniform Lifetime table (Publication 590-B).

Keep your eye out for updates to the publication each year.

Email your questions to .

This story was originally published in May 2026. 

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