Turning 73 This Year? Watch Out for This Tax Torpedo.

Turning 73 means you'll have to begin taking required minimum distributions (RMDs) from your tax-deferred retirement accounts, but that could cost you in unexpected ways, including Social Security benefit taxes. This doesn't happen to everyone, but it's a possibility you definitely want to be aware of before you file your 2026 return.

You probably already know that RMDs can raise your tax bill, but exactly how they can cost you Social Security benefits isn't clear to most people. Here's a closer look at how that works and ways you might be able to avoid it.

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How RMDs can lead to Social Security benefit taxes

RMDs are mandatory annual withdrawals that force you to pay taxes on your tax-deferred retirement savings. How much you must withdraw each year depends on your age and account balance, but for some, RMDs can amount to tens of thousands of dollars.

This extra money adds to your adjusted gross income (AGI), and it can raise your income tax bill for the year. For some, it's enough to push them into a higher marginal tax bracket than they're used to.

Your RMDs could also lead to Social Security benefit taxes because your AGI is part of your provisional income, alongside any nontaxable interest you have from municipal bonds, and half your annual Social Security benefit. The government uses provisional income when determining how much of your Social Security benefits are taxable.

A higher AGI due to RMDs will increase your provisional income and could force you to pay ordinary income taxes on up to 85% of your benefits each year. This could add thousands of dollars in additional taxes, though the amount varies widely from person to person.

What to do if you're worried about RMDs triggering Social Security benefit taxes

If you're worried about RMDs affecting your tax bill, try not to withdraw more than you need to cover your expenses. Minimize spending where possible to keep your AGI low, and don't take an RMD from your current 401(k) if you're still working and own less than 5% of the company. You aren't required to take RMDs from this 401(k) until you're actually retired.

You could also do a qualified charitable distribution (QCD) if you don't need your savings to cover your living costs today. This is where you donate your RMD to a charity rather than keep it yourself. It fulfills your obligation to the IRS, but this type of withdrawal won't affect your taxes at all.

The catch is, it only counts as a QCD if the money doesn't pass through your hands first. You must notify your plan administrator of the charity to which you'd like to send the funds. Then, it will either cut you a check in the charity's name or forward the money directly.

You still have plenty of time to do this for 2026, but it's not an instant process. Consider starting the process in the next few weeks if you haven't already taken your RMDs so that you can complete it well before the deadline.

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