Retirees Face Bigger Tax Bills as Surging Market Lifts Required IRA Withdrawals
• Surging stock market could increase required minimum distributions (RMDs) from retirement accounts, resulting in higher taxes • RMDs are mandatory annual withdrawals retirees must take from 401(k)s and IRAs starting at age 73 • Higher account balances at year-end means larger RMDs and potentially bigger tax bills the following year • A market drop after forced withdrawals could erode retirement savings • Steps to reduce impact include Roth conversions, charitable donations from IRAs, continuing to work, and rolling over to current employer retirement plans