Retirement brochure  


Required Minimum Distributions

Questions and answers


What is a required minimum distribution?

The Internal Revenue Service (IRS) requires you to start withdrawing money from your before-tax 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). Historical note: Roth 403(b) deferrals used to be included.

Your minimum distribution is a function of your account balance and your life expectancy.

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:

Take the prior year-end account balance and divide it by your life expectancy factor for the year of distribution. For most individuals, you are able to use the Uniform Life Expectancy Table I (below) to obtain the life expectancy factor. However, if your beneficiary is your spouse and he/she is more than 10 years younger than you, the IRS allows us to apply a more liberal life expectancy factor. You can call us to obtain this Joint Life & Last Survivor expectancy factor. You can also get it from the IRS by referencing Appendix C, Table III, of Publication 590.
Uniform Life Expectancy Table*
AgeLife Expectancy FactorAgeLife Expectancy Factor
*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.

TSA 2620-280-0223(W)

Effective January 2024. Policies and programs described are subject to change at any time.