How to Reduce or Delay RMDs from Pre-Tax Accounts

If you've spent decades contributing to a traditional IRA, 401(k), 403(b), or similar pre-tax retirement account, you've been building wealth with the promise that taxes come later. Well, later is now. Depending on your birth year, the IRS requires you to start withdrawing a minimum amount each year — at age 73 or 75 — whether you need the income or not. These are called required minimum distributions (RMDs), and they can push your taxable income higher than expected, trigger Medicare premium surcharges, and create tax bills that catch retirees off guard.

The good news is that there are legitimate, IRS-compliant strategies to reduce the size of your RMDs, delay when they begin, or redirect them in ways that minimize the tax impact. This blog post walks through the most effective options.

What Are RMDs and Why Do They Matter?

Required minimum distributions (RMDs) are the IRS's mechanism for collecting taxes on money that has been growing tax-deferred in retirement accounts. Under SECURE 2.0, your RMD starting age depends on your birth year: age 73 if you were born between 1951 and 1959, or age 75 if you were born in 1960 or later. This gives many people a longer runway to plan than they may realize.

Your annual RMD is calculated by dividing your prior year-end account balance by a life expectancy factor from the IRS Uniform Lifetime Table. The larger your pre-tax balances, the larger your RMDs — and the larger your tax bill.

The problem for many retirees is that RMDs arrive on top of Social Security, pension income, or part-time earnings, pushing their effective tax rate higher than anticipated. And if you fail to take a required distribution, the IRS imposes a 25% excise tax on the amount not withdrawn (reduced to 10% if corrected within two years). Planning ahead is the only reliable way to avoid getting caught.

Strategy 1: Roth Conversions Before Your RMD Age

Between retirement and your RMD starting age (73 or 75, depending on your birth year), many retirees experience a period of relatively low taxable income — before Social Security begins, before RMDs kick in, and after employment income stops. That window is ideal for converting portions of your traditional IRA or 401(k) to a Roth. You pay ordinary income tax on the converted amount now, at potentially lower rates, rather than being forced to take larger taxable RMDs later.

Key consideration: Conversions increase your taxable income in the year they occur, so thoughtful planning is essential to avoid overshooting into a higher bracket. This strategy works best when coordinated with your full tax picture each year.

Strategy 2: Qualified Charitable Distributions (QCDs)

This is more valuable than taking the RMD and then donating. That approach only provides a deduction if you itemize, which most retirees don't. The QCD keeps the distribution entirely out of your income.

Redirecting your charitable giving through a QCD can lower your adjusted gross income (AGI), which can have downstream effects on Medicare premiums, the taxability of Social Security benefits, and your overall tax bracket.

Important rules

The distribution must go directly from your IRA to the charity — you cannot receive the funds first and then donate them. QCDs must come from a traditional IRA (not directly from a 401(k) or 403(b), though those can be rolled into an IRA first). The recipient must be a 501(c)(3) organization; donor-advised funds do not qualify.

Strategy 3: The Still-Working Exception

If you are still employed at age 73 and actively participating in your current employer's 401(k) or 403(b) plan, you may be able to delay RMDs from that specific plan until you actually retire. This is known as the still-working (or still-employed) exception.

What this covers — and doesn't: The exception applies only to the plan at your current employer. IRAs and retirement accounts from previous employers are still subject to RMDs at 73, unless you roll them into your current employer's plan (if that plan permits incoming rollovers). Owners of more than 5% of the company are not eligible for this exception, regardless of employment status.

Strategy 4: Roth Account Contributions in Workplace Plans

Starting in 2024, SECURE 2.0 eliminated RMDs from Roth accounts inside workplace plans — including 401(k), 403(b), and 457(b) plans. This is a meaningful shift.

If your employer's plan offers a Roth 401(k) or Roth 403(b) option, contributions made on an after-tax basis will grow tax-free and will not generate RMDs during your lifetime. For people still in the workforce who expect to be in a similar or higher tax bracket in retirement, directing contributions to the Roth option is worth serious consideration.

This strategy doesn't reduce RMDs on money already in pre-tax accounts, but it prevents future balances from adding to the problem. Combined with a Roth conversion plan, it can significantly reduce your projected RMD burden over time.

Strategy 5: Consolidating and Simplifying Your Accounts

The IRS has specific aggregation rules that govern how RMDs are calculated across multiple accounts. Understanding them — and simplifying your account structure — can reduce errors and open up planning opportunities.

How aggregation works by account type

Traditional IRAs can be aggregated — you calculate the total RMD across all your IRAs and withdraw it from any one (or combination) of them. 401(k) and 403(b) accounts follow similar logic within their own category. However, IRAs and workplace plans cannot be aggregated with each other — they must be calculated and satisfied separately. 457(b) accounts must be calculated and withdrawn from independently for each plan.

For people who have accumulated multiple IRAs or 401(k)s from different employers over the years, consolidating into fewer accounts simplifies the process, reduces the risk of missed RMDs, and makes Roth conversion planning easier to manage. A direct rollover from old employer plans into a single IRA is often a straightforward, tax-neutral move.

FAQ: Common RMD Questions

Conclusion

RMDs are a reality for most retirees, but the size of your tax bill — and when you pay it — is largely within your control when you plan early. The strategies in this post work best when coordinated: a Roth conversion plan tailored to your income, a QCD strategy if you give to charity, the right account structure going forward, and a clear picture of how all your income sources interact.

These aren't one-time decisions. They require annual review as your balances, brackets, and retirement income change. If you're approaching 73 — or still years away but want to get ahead of the problem — now is the right time to build a plan.