Two coworkers at the same agency retire in the same month. Dana was born June 30, 1949. Marcus was born one day later, July 1, 1949. They've shared an office, a commute, and a lot of gripes about the same GS pay scale. But when it came to required minimum distributions, one day of birth put them on different rules. Dana had to start withdrawals at 70½. Marcus got to wait until 72.

That is the kind of cliff that legislation creates, and it has happened twice in recent years. Here's how we got from 70½ to 73, and where we're headed.

Where 70½ came from

For decades, the rule was simple and a little odd. You had to begin taking money out of traditional retirement accounts by April 1 of the year after you turned 70½. The half-year was a quirk of the original rules, which were built around the idea of reaching a particular age partway through a calendar year. It confused people, and it produced a steady stream of "wait, did I turn 70½ this year or last?" phone calls.

The logic behind RMDs themselves was never complicated. Congress let you defer taxes on contributions and growth, but not forever. At some point the government wanted its share. The age was set when life expectancy was shorter and the typical retiree had a pension carrying most of the load, not a large account balance.

By the 2010s, that picture had changed. People lived longer. Many worked later. Account balances in 401(k)s, IRAs, and the TSP had grown into the primary source of retirement income for a lot of households. Being forced to withdraw at 70½ meant taking taxable money out of accounts that retirees might not need for another fifteen years.

The SECURE Act moves it to 72

The first change came with the SECURE Act, signed in December 2019. It raised the RMD age from 70½ to 72, but only for people who hadn't yet reached 70½ by December 31, 2019.

That's the line that split Dana and Marcus. Anyone born before July 1, 1949, stayed under the old rule. Anyone born on or after that date got the new one.

Policy people sometimes call this a "transition rule." Retirees call it luck of the calendar. Either way, it's a reminder that the birth date on your paperwork can matter more than your retirement date.

SECURE 2.0 pushes it to 73, then 75

Three years later, Congress did it again. The SECURE 2.0 Act, passed in December 2022 as part of a larger spending bill, set up a two-step increase:

  • Age 73 for people who turn 72 after December 31, 2022. In practice, that means those born from 1951 through 1959.
  • Age 75 for people born in 1960 or later, beginning in 2033.

If you were born in 1950, you're in an in-between spot. You turned 72 in 2022, which was too early for the new rule, so your RMD age stayed at 72. People born in 1951 were the first to get the 73 age.

There's a wrinkle worth knowing about. The statutory language on the 75 threshold created some confusion about people born in 1959, who could arguably fall under either rule. Congress's evident intent was to put the age-75 group at 1960 and later, and IRS guidance has treated it that way. If you were born in 1959, confirm your age on irs.gov or with a tax professional before you assume anything.

A quick example

Say you were born in 1952 and have a traditional IRA worth $500,000 on December 31 of the year before you turn 73. The IRS Uniform Lifetime Table uses a divisor of 26.5 for age 73. Your RMD is about $18,868 ($500,000 divided by 26.5).

Now picture a retiree born in 1948 with the same balance at 72. Under the old table in use before 2022, the required amount would have been higher. The IRS also updated its life expectancy tables, effective in 2022, to reflect longer lifespans. That change lowers the required percentage each year, so the rule change and the table change work together.

Check the current tables each year on irs.gov, since the divisors are published there and the IRS can revise them.

Why Congress kept raising the age

Three forces pushed in the same direction.

Longevity. A 70-year-old in 1986 had a shorter expected retirement than one today. Forcing withdrawals at the same age no longer matched how long people needed their savings to last.

Working longer. More Americans stay in the workforce into their late 60s and 70s. For them, RMDs were an annoying tax bill on money they weren't trying to spend.

Bipartisan appeal. Delaying RMDs was an easy thing to agree on. It helps savers, and the lost near-term tax revenue was offset elsewhere in the bills. I'd be careful about claiming more than that. Budget scoring is complicated, and the full story depends on how you measure it.

What changed for TSP participants

If you're a federal employee or retiree, the TSP follows the same RMD age, but there are a few details to keep in mind.

The TSP generally requires you to begin RMDs by April 1 of the year after you reach your RMD age or separate from service, whichever comes later. That "still working" exception matters if you stay in federal service past 73. It's a feature IRAs don't have. For an IRA, working doesn't pause your RMD.

Also, RMDs are calculated account by account. You can't satisfy your TSP RMD by taking extra from your IRA, and the reverse is true as well. Your TSP balance and your IRA balance each have their own requirement. For IRAs, you can total the RMDs and take them from any one of them, but the TSP stays separate.

Roth balances changed too. Beginning in 2024, SECURE 2.0 eliminated lifetime RMDs for Roth accounts in employer plans, which includes the Roth TSP. Roth IRAs never had them. That puts Roth TSP money on equal footing with a Roth IRA, without the need to roll it over just to dodge RMDs.

The penalty also got lighter

While moving the age, Congress softened the consequences of a missed RMD. The excise tax used to be 50 percent of the amount you should have withdrawn. It's now 25 percent, and it drops to 10 percent if you correct the mistake within a limited window. These rules change, so verify the current details on irs.gov.

A lower penalty isn't a reason to be casual, though. A 25 percent hit on a missed $19,000 RMD is still nearly $4,800.

What to do with this

Don't memorize the age. Know your birth year, and look up your RMD age from that.

  • Born before July 1, 1949: 70½
  • Born July 1, 1949 through 1950: 72
  • Born 1951 through 1959: 73
  • Born 1960 or later: 75

Then run the numbers well before the deadline. Your first RMD can be delayed until April 1 of the following year, but doing that means you take two distributions in the same calendar year, which can push you into a higher bracket. For many people, taking the first one in the year they turn the RMD age is the cleaner path.

Dana and Marcus could have used a chart like that, and so could a lot of other people. The age keeps moving, and every time it does, the real question is the same: which rule applies to you? For exact figures, tables, and deadlines, check tsp.gov for your TSP account and irs.gov for everything else.