Retirement brochure
PRINT THIS PAGE | EMAIL THIS PAGE
Required Minimum Distributions
Questions and answers
403(b)
What is a required minimum distribution?
The Internal Revenue Service (IRS) requires you to start withdrawing money from your before-tax and Roth 403(b) account at the later of age 73 (effective January 1, 2023) or the calendar year you retire from an employer through which you contributed. These withdrawals are called required minimum distributions (RMDs).
Your minimum distribution is a function of your account balance and your life expectancy.
Rolling over your Roth 403(b) to a Roth IRA any time prior to the year in which you turn age 73 will eliminate the need to take an RMD on this portion of your 403(b). If you rollover after age 73, your current year RMD must be taken prior to rollover.
How is my RMD calculated?
Member Benefits will assist you in calculating your RMD. Each year we will notify you of the requirement to withdraw. Here’s how to calculate your RMD:
| Uniform Life Expectancy Table* | |||
|---|---|---|---|
| Age | Life Expectancy Factor | Age | Life Expectancy Factor |
| 73 | 26.5 | 83 | 17.7 |
| 74 | 25.5 | 84 | 16.8 |
| 75 | 24.6 | 85 | 16.0 |
| 76 | 23.7 | 86 | 15.2 |
| 77 | 22.9 | 87 | 14.4 |
| 78 | 22.0 | 88 | 13.7 |
| 79 | 21.1 | 89 | 12.9 |
| 80 | 20.2 | 90 | 12.2 |
| 81 | 19.4 | 91 | 11.5 |
| 82 | 18.5 | ||
| *Source: Internal Revenue Service (IRS) | |||
Traditional IRA and SEP IRA
Like the 403(b), these IRA accounts also require RMDs to start at age 73 (effective January 1, 2023). However, unlike the 403(b), you cannot delay the RMD past age 73, even if you continue to work. The calculation is obtained by taking the prior year-end balance divided by your life expectancy factor. As with the 403(b) RMD, the same tables provided by the IRS are used for its calculation.
What should I do when I need to take my first RMD?
In the year you reach age 73 (effective January 1, 2023), Member Benefits will send you an RMD notice. Please contact Member Benefits to assist you in setting up your RMD schedule. This will establish ongoing instructions to process your RMD. After your initial setup, Member Benefits will send you a notice annually reminding you of the RMD. If you wish to change the initial setup instructions, you will need to complete a new 403(b) or Traditional IRA Required Minimum Distributions Setup Instructions form.
You will face up to an IRA penalty of 25% on any undistributed RMDs.
How we do business
Our vision at Member Benefits, “Every Member Financially Secure”, is more than words. It represents the fundamental reason for our existence—to serve Wisconsin public school employees. It also reflects our commitment to helping you achieve your financial dreams.
Effective February 2023. Policies and programs described are subject to change at any time.
Created by educators
WEA Member Benefits
Over 50 years ago, we were created by Wisconsin educators for Wisconsin educators. No other financial organization can say this. Explore our unique programs and services.