Kiplinger Flags Three Costly RMD Tax Mistakes to Avoid in Your 70s

What the Report Says

Kiplinger published a report on November 1, 2026, identifying three costly tax mistakes that people in their 70s commonly make once required minimum distributions, or RMDs, begin. The central argument of the piece is stated plainly in its summary: retirees should not stop tax planning when RMDs start, and making these common mistakes in your 70s can result in needlessly generous payments to the IRS.

The report does not present a single new rule change or a new IRS announcement. It is a planning-focused piece aimed at a specific group of Americans: those who have reached the age at which the tax code requires them to begin withdrawing money from tax-deferred retirement accounts. The framing matters because it treats the start of RMDs not as the end of a retiree's tax decisions but as the beginning of a new and less forgiving phase of them.

What follows is an explanation of the mechanism the report is describing, why it affects a large number of American households, and what parts of a retiree's financial life it touches. The specific mistakes Kiplinger enumerates are the substance of its article; this piece explains the surrounding machinery so a reader can understand why those mistakes carry a cost.

How RMDs Work and Why They Change the Tax Picture

A required minimum distribution is the minimum amount the owner of a traditional individual retirement account, or a traditional workplace retirement plan such as a 401(k), must withdraw each year once they reach the age the law sets for starting. The money in those accounts has generally gone in untaxed, and it grows untaxed. The RMD rules exist so that the untaxed balance does not sit indefinitely; the government wants the money withdrawn and taxed on a schedule.

The key point for a reader is that an RMD is not optional and it is not a discretionary spending decision. Once the obligation begins, the withdrawal happens whether or not the retiree needs the cash. And because traditional IRA and 401(k) withdrawals are generally counted as ordinary income, the RMD raises the retiree's taxable income for that year.

That single mechanical fact is what makes the planning phase so consequential. A retiree who has spent decades thinking about saving into a retirement account now has to think about the reverse problem: how to take money out in a way that does not push more of it into a higher tax bracket than necessary, does not trigger avoidable consequences elsewhere in the tax code, and does not leave a larger taxable balance to heirs than the retiree intended.

Why the 70s Are the Pressure Point

The report's focus on the 70s is not arbitrary. That decade is when the RMD obligation typically begins for American retirees, and it is also when several other tax-relevant decisions converge. Social Security benefits are usually being received. Medicare enrollment and premium rules are in play. Many households are drawing on a mix of taxable savings, tax-deferred accounts and, in some cases, Roth accounts, each taxed differently.

Because these pieces interact, a decision made about one can change the tax treatment of another. A larger withdrawal from a traditional account can change how much of a retiree's Social Security benefit is subject to tax, for example, and it can change the income figure used in Medicare premium calculations. These interactions are the reason the report frames the start of RMDs as a moment that requires continued attention rather than a finish line.

The broader consequence is that the cost of a mistake compounds. A withdrawal that is larger than it needed to be, or timed worse than it needed to be, does not just cost tax in a single year. It can shift the baseline for subsequent years and change what is left in the account for later.

What the Mistakes Affect

The report's headline claim is about money going to the IRS that did not have to. For an American reader, that cost lands in a few identifiable places.

• Current-year income tax. Traditional retirement account withdrawals are generally taxed as ordinary income, so the size and timing of a withdrawal affect the rate applied to it.
• Social Security taxation. The share of benefits subject to federal income tax depends on the taxpayer's overall income, which retirement account withdrawals feed into.
• Medicare premiums. Premiums for Medicare Part B and Part D are tied to income figures, so a larger withdrawal year can affect what a retiree pays.
• What heirs receive. Money left in a traditional account is generally still taxable when inherited, so the size of the remaining balance and who inherits it both matter.
• State tax treatment. States differ in how they treat retirement income, so the same withdrawal can carry a different cost depending on where the retiree lives.

None of these is a new rule introduced by the report. They are the existing features of the tax system that make the report's subject worth reading. The report's contribution is to argue that retirees in their 70s commonly stop paying attention to them at exactly the wrong moment.

The Planning Question the Report Raises

The practical implication of the Kiplinger report is that the start of RMDs should be treated as a planning event rather than an administrative one. A retiree who simply takes the required amount each year without reviewing the wider picture may be leaving decisions unmade that would have reduced the tax cost of the same withdrawals.

That does not mean there is a single correct approach. The right mix depends on a household's other income, its health, its charitable intentions, its state of residence and what it wants to leave behind. What the report does suggest is that the absence of a plan is itself a choice, and one that tends to favor the Treasury.

The report arrives at a moment when a large cohort of Americans is moving through this transition. Readers approaching or already in their 70s who hold traditional retirement accounts are the audience the piece is written for. Anyone in that group who has not reviewed how their withdrawals interact with Social Security, Medicare and their overall income picture has a concrete reason to do so, and the Kiplinger article sets out the specific errors it considers most costly.

For readers outside that group, the report is a reminder that the tax treatment of retirement money is decided across a lifetime of choices, not at a single moment. The decisions made before RMDs begin shape the options available once they do.

Source: Kiplinger

This article is for information only and is not investment advice, a recommendation, or an offer to buy or sell any security. Figures are sourced from third-party market data providers and may be delayed. Do your own research before investing.