401(k) RMD Rules: No Aggregation, the Still-Working Exception, and What to Do With Multiple Old Plans

If you've spent your career in the private sector, you've probably accumulated 401(k) accounts — at your current employer, at two or three past employers, and maybe a rollover IRA from some of them. When RMDs start, these accounts don't behave like IRAs. Each 401(k) plan is a separate distribution obligation you cannot pool across plans. The still-working exception is narrower than most retirees realize. And Solo 401(k) owners — self-employed people and small business owners — have no way to delay RMDs past 73, regardless of whether they're still working. Here's what you need to know.

RMD starting age: SECURE 2.0 applies to 401(k)s too

SECURE 2.0 Act § 107 raised the RMD age uniformly across all retirement account types including 401(k)s:¹

The April 1 first-year deadline creates a double-distribution trap: if you defer your first RMD to April 1, you owe that year's RMD by December 31 of the same calendar year — two full RMDs in one year, potentially pushing you into a higher bracket. Taking the first 401(k) RMD in the year you turn 73 avoids this. See our RMD starting age guide for the full birth-year table.

The no-aggregation rule: 401(k)'s most important difference from IRAs

This is the rule that trips up the most retirees with multiple accounts. Traditional IRAs can be aggregated — calculate the RMD for each IRA, then take the total from any one account. 401(k) plans cannot.²

Example: a retiree with three plans

A 74-year-old has: an IRA ($400,000), a current employer 401(k) ($300,000, still working), and an old employer 401(k) ($200,000, terminated). The distribution math:

• IRA: RMD calculated on $400,000 balance. She can roll the IRA RMD into cash and reinvest — the only pool she can satisfy from one account.
• Old employer 401(k): RMD must come from that plan specifically. No still-working exception because she's not working there anymore. Separate distribution required.
• Current employer 401(k): May be deferred under the still-working exception (below) if she's under 5% ownership and the plan permits.

The common mistake: assuming you can take "extra" from your IRA to cover the old 401(k) RMD. You cannot. The shortfall is a 25% penalty on the amount not distributed.

The still-working exception: narrower than most people think

401(k) plan participants who are still employed at the sponsoring employer can delay RMDs from that plan until actual retirement — past the normal age-73 or age-75 starting date. But the conditions are specific:³

When you do retire, your first RMD from the current employer's 401(k) is due by April 1 of the year following the year of retirement. The April 1 rule applies — consider taking the final employer plan RMD in the retirement year itself to avoid the same double-distribution trap.

Old employer 401(k)s: RMDs start at 73 regardless

This is where many late-career workers with forgotten old accounts get surprised. A 401(k) at a company you left 15 years ago — one you may not even think about day-to-day — is still a qualified plan with its own RMD clock. When you turn 73 (or 75), you owe an RMD from that plan. The still-working exception doesn't apply because you're no longer employed there.

Practical implications:

• The plan will typically send you RMD notices — but this is not guaranteed for every old employer, especially if your address has changed.
• You remain responsible for calculating and taking the correct distribution even if you don't receive a notice.
• A missed RMD from an old 401(k) carries the same 25% penalty (10% if corrected in the two-year Correction Window) as a missed IRA RMD.
• Rolling an old employer 401(k) to an IRA before RMD age solves the problem — the balance joins your IRA aggregation pool, simplifying to a single annual decision. See timing considerations below.

If you have old 401(k)s from previous employers and are approaching 73, inventorying and consolidating them before the RMD age is usually the cleanest move. Use our aggregation rules guide to map your accounts before making the decision.

How to calculate your 401(k) RMD

The calculation uses the same formula as IRA RMDs — but done separately for each plan:

1. Find each 401(k)'s December 31 prior-year balance (from the annual statement or plan portal).
2. Look up your IRS Uniform Lifetime Table divisor for your age that year. (Example: age 74 → divisor 25.5; age 80 → divisor 20.2 — from the IRS Uniform Lifetime Table effective 2022 and 2026.)⁴
3. Divide each plan's balance by its own divisor.
4. Take that amount from each plan separately.

If your spouse is the sole beneficiary and more than 10 years younger, use IRS Table II (Joint Life and Last Survivor) instead — it produces a larger divisor and therefore a smaller RMD. This applies to 401(k)s just as it does to IRAs. See our spousal RMD strategy guide for divisor comparisons.

Use our RMD Calculator to see this year's required amount and a 10-year projection.

Solo 401(k): no still-working exception for owners

Self-employed individuals and small business owners who use a Solo 401(k) — sometimes called an individual 401(k) or i401(k) — face a specific constraint: the still-working exception does not apply to them.

The ownership test requires owning less than 5% of the sponsoring employer. A sole proprietor, single-member LLC owner, or partner with a majority interest owns far more than 5% — typically 100%. This means:

• Solo 401(k) RMDs begin at age 73 (born 1951–1959) or 75 (born 1960+) regardless of whether you are still actively self-employed.
• A freelance consultant still earning $200,000/year at 75 must still take RMDs from the Solo 401(k) — the exception that covers a corporate employee with a W-2 does not extend to owner-operators.
• If you are a minority partner in a partnership (own less than 5%), the still-working exception may apply to the partnership's 401(k) plan, but confirm with your plan administrator and tax advisor.

For business owners approaching 73 with significant Solo 401(k) balances, the Roth conversion window before RMD age becomes especially important. See our Roth conversion guide for the pre-RMD bracket-filling strategy.

Roth 401(k): no lifetime RMDs starting in 2024

SECURE 2.0 Act § 325 eliminated lifetime required minimum distributions from Roth employer plan accounts — Roth 401(k)s, Roth 403(b)s, and Roth TSP accounts — effective for tax years beginning after December 31, 2023.¹

If any portion of your 401(k) is in a Roth 401(k) sub-account, you are not required to take distributions from that portion during your lifetime. The balance can grow tax-free indefinitely without the mandatory distribution schedule that applies to the pre-tax 401(k) portion.

Prior to 2024, Roth 401(k) holders would often roll the Roth balance to a Roth IRA before age 73 to avoid lifetime RMDs. That workaround is no longer necessary. However, rolling a Roth 401(k) to a Roth IRA may still be worth considering for investment flexibility and to consolidate accounts for simplicity.

Inherited Roth 401(k): The no-lifetime-RMD rule applies only during the original account holder's lifetime. Non-spouse beneficiaries who inherit a Roth 401(k) are still subject to the 10-year depletion rule — though there are no annual RMD requirements within the 10-year period as long as the full balance is distributed by December 31 of year 10. See our Roth RMD rules guide for how inherited Roth accounts work.

QCDs from 401(k)s: not available — roll to IRA first

Qualified Charitable Distributions are only available from individual retirement arrangements (IRAs) — traditional, Roth, SEP, or SIMPLE. IRC § 408(d)(8) does not extend QCD treatment to employer-sponsored plans including 401(k)s.⁵

This means if you want to use QCDs — which let IRA owners 70½ and older give up to $111,000 directly to charity in 2026 and exclude it from income entirely — you must first roll the 401(k) balance to a traditional IRA.

Rollover timing: RMD amounts are not eligible for rollover. The RMD for the final year before a rollover must be distributed before you can roll the remaining balance to an IRA. If you plan to roll old 401(k)s to an IRA for QCD access, doing so before age 73 avoids this complication. See our QCD guide for how to structure charitable giving from an IRA.

Employer stock in a 401(k): the NUA opportunity

If your 401(k) holds highly appreciated employer stock, taking a lump-sum distribution before (or instead of) rolling to an IRA may allow you to pay long-term capital gains rates on the appreciated portion rather than ordinary income rates — a technique called Net Unrealized Appreciation (NUA). This permanently reduces your future RMD base by removing the employer stock from the plan.

NUA is only triggered by a qualifying lump-sum distribution — retirement, death, reaching 59½, or disability — and must be done in a single calendar year. It does not interact well with a rollover IRA. See our NUA strategy guide for how the math works and when it beats a standard rollover.

Rolling old 401(k)s to an IRA: timing and considerations

For most retirees with multiple old employer 401(k)s, rolling them to a traditional IRA before the RMD age simplifies the distribution picture significantly. The consolidated IRA joins the aggregation pool — calculate once, take from one account. But the decision isn't automatic:

Reasons to roll old 401(k) to IRA:

• Aggregation simplification. Multiple old 401(k)s become one IRA pool — one calculation, one distribution. Eliminates the risk of a missed plan-specific RMD.
• QCD access. IRA balance becomes eligible for qualified charitable distributions up to $111,000/year in 2026, potentially eliminating income and IRMAA surcharges.
• Investment flexibility. Major IRA custodians offer broader menus than most employer plans; some old 401(k)s charge high-expense proprietary funds.
• Beneficiary control. IRA beneficiary designations are updated directly at the custodian; employer plan designations are controlled by the plan document.

Reasons to keep a 401(k) in place:

• Still-working exception for current employer plan. If you're still employed and under 5% ownership, keeping the current employer 401(k) in the plan lets you delay those RMDs until retirement. Rolling to an IRA forfeits the exception.
• ERISA creditor protection. Qualified plans have federal-level protection from creditors; IRA protection is state-dependent. If you have significant creditor exposure, the plan may offer stronger protection than an IRA in some states.
• Litigation risk. Lawsuit-prone professionals (some business owners) may benefit from keeping assets in ERISA-qualified plans.
• NUA opportunity. Rolling employer stock to an IRA converts the NUA gain to ordinary income tax treatment permanently — you lose the capital gains rate advantage.

Inherited 401(k): the 10-year rule applies

Non-spouse beneficiaries who inherit a 401(k) after December 31, 2019 are subject to the SECURE Act 10-year rule: the inherited account must be fully distributed by December 31 of the 10th year after the year of death.

Under T.D. 10001 (finalized July 2024), if the original account holder had passed their Required Beginning Date (RBD) and was taking RMDs, the beneficiary must also take annual RMDs in years 1–9 (using the Single Life Expectancy Table), with the full remaining balance distributed by year 10.⁵

Most employer plans require non-spouse beneficiaries to receive distributions from the 401(k) plan itself or roll to an Inherited IRA. Surviving spouses have the additional option to roll the inherited 401(k) to their own IRA or their own 401(k) — which restores the Uniform Lifetime Table and potentially delays RMDs. See our surviving spouse IRA options guide for the three-path comparison.

401(k) vs. IRA vs. 403(b): key RMD differences

What an advisor models that you can't easily do alone

Retirees with multiple 401(k)s — current employer, two or three old employers, and an IRA — face a distribution picture that's genuinely complex. A specialist will:

• Inventory all plans, confirm each plan's RMD calculation and due dates, and build a distribution calendar that satisfies each separately
• Analyze whether rolling old 401(k)s to an IRA before 73 saves enough in tax and simplification to justify the rollover cost and any surrender periods
• Model the QCD opportunity: if rolling to an IRA and you have charitable intent, how many years of $111,000 QCDs does it take to break even against the rollover friction?
• Evaluate the NUA strategy for employer stock: what's the spread between capital gains and ordinary income rates on the appreciation, and does it beat rollover?
• Coordinate still-working exception timing for the current employer plan — specifically, the optimal year to retire relative to RMD timing to minimize the double-distribution problem
• Run Roth conversion projections for the pre-RMD bracket-filling window, especially for Solo 401(k) owners who can't defer past 73

A generalist advisor focused on accumulation often hasn't built the multi-plan distribution models that retirement specialists use. For retirees with six-figure 401(k) balances across multiple plans, the coordination complexity justifies the specialist fee. See our withdrawal order guide and Roth conversion guide for how these strategies interact.

Sources

1. IRS — Retirement Topics: Required Minimum Distributions (RMDs). SECURE 2.0 Act § 107: RMD age 73 for those born 1951–1959; age 75 for those born 1960 and later. SECURE 2.0 § 325: Roth 401(k), Roth 403(b), and Roth TSP accounts no longer subject to lifetime RMDs effective for tax years beginning after December 31, 2023.
2. IRS — RMD Comparison Chart: IRAs vs. Defined Contribution Plans. Aggregation rules: IRA RMDs may be aggregated and taken from any one IRA; 401(k) plans require separate RMDs from each plan; 403(b) accounts have their own separate aggregation pool; 401(k) and 403(b) RMDs are not interchangeable.
3. IRS — Retirement Plan and IRA Required Minimum Distributions FAQs. Still-working exception: participants in a 401(k) or 403(b) plan who are not 5%-or-more owners and are still employed at the plan sponsor may delay RMDs from that plan until actual retirement; IRAs are not eligible for the still-working exception; Solo 401(k) owner-operators typically own ≥5% and cannot use this exception.
4. IRS Publication 590-B — Distributions from Individual Retirement Arrangements. IRS Uniform Lifetime Table (Appendix B): divisors for ages 72–120 used to calculate RMDs from traditional IRAs and 401(k)s; updated table effective January 1, 2022 and applicable for 2026 distributions. Example divisors: age 73 = 26.5; age 74 = 25.5; age 80 = 20.2; age 85 = 16.0.
5. IRS — IRA Required Minimum Distributions. IRC § 408(d)(8): QCDs are available only from individual retirement arrangements (IRAs); employer-sponsored plans including 401(k)s are not eligible. T.D. 10001 (July 2024): non-EDB beneficiaries under the 10-year rule must take annual RMDs in years 1–9 if the decedent had passed the Required Beginning Date.

401(k) RMD rules verified against IRS guidance and SECURE 2.0 Act provisions, May 2026. Still-working exception eligibility depends on plan document — confirm with your plan administrator. Aggregation rules confirmed against IRS RMD Comparison Chart. Roth 401(k) no-lifetime-RMD rule effective for tax years after December 31, 2023 per SECURE 2.0 § 325.