The IRS provides worksheets and tables to calculate RMDs. If you do not take your RMD, you'll face a 25% penalty on whatever amount you fail to withdraw. If you act quickly to correct this mistake, the penalty may be reduced to 10%. (For 2022 and previous tax years, the penalty was 50%, but the Secure Act 2.0 decreased the fine.)
So if you were supposed to take a $5,000 RMD in 2022 (for taxes that were due in April 2023) and you don't remove any money from your 401(k), you would have owed $2,500. But in 2023, your penalty would drop to $1,250 (for taxes that are due in April 2024).
Exceptions to RMDs
Although there's generally no flexibility when it comes to 401(k) RMDs, there is one exception. If you're still working for the company sponsoring your plan by the time you turn 73 (previously 72) and you don't own 5% or more of that company, you may be able to avoid RMDs for as long as you remain employed -- although not all plans allow this.
Once you leave that company, however, you'll need to start taking withdrawals. Also keep in mind that this exception applies to 401(k)s only. If you have an IRA in addition to your 401(k), you'll need to take your RMDs regardless of whether you're still working at the time.
