Save Money Retirement distribution deadline draws near

The IRS defers taxes on many retirement accounts. But at a certain point, the agency wants to start collecting its due. You must start taking required minimum distributions, or RMDs, at age 70K.

RMDs are required from tax-deferred retirement plans: traditional individual retirement accounts, SEP and Simple IRAs, and workplace plans like 401(k)s. They’re not required from Roth IRAs.

In general, you have to take your allotted distributions by Dec. 31 each year. RMD first-timers — those who turned 70K just this year — get an extension to April 1.

• If eligible, decide if you want to use an extension: Using it means you’ll have to take both this year’s and next year’s RMD in 2017. That matters because these distributions are taxed.

• Get the process rolling: The amount you need to withdraw is based on an IRS calculation that divides your account balance at the end of the prior year by a life expectancy factor for your age. The RMD will be calculated separately for each retirement account, and account providers typically do the math for you.

• Do better next year: Ask your plan administrator to calculate your RMD amount automatically at the end of each year and send you a distribution each month or each quarter, just like a paycheck. NerdWallet