Among the most common surprises of retirement are required minimum distributions (RMDs) and the tax consequences that come with them. Under SECURE 2.0, RMDs begin at age 73 for people born between 1951 and 1959.
Consider a 73-year-old single retiree sitting on $940,000 split between an $820,000 traditional IRA and a $120,000 Roth. Social Security pays her $28,000 a year. On paper, she is comfortable. Then her first RMD arrives, and it has consequences.
The IRS uses “provisional income” to decide how much Social Security gets taxed. For single filers, the breakpoints are $25,000 and $34,000. Below $25,000, none of her Social Security is taxable. Between the two figures, up to 50% becomes taxable. Above $34,000, up to 85% of the benefit gets pulled into the taxable column.
Provisional income is roughly adjusted gross income plus tax-exempt interest plus half of Social Security. Half of her $28,000 benefit is $14,000. Stack a $34,000 RMD on top and provisional income lands near $48,000, well past the upper breakpoint. About $23,800 of her benefit is suddenly taxable income she did not have to plan for the year before.
The result is the so-called tax torpedo. Each additional dollar of RMD also drags up to 85 cents of previously tax-free Social Security into taxable income. Effectively, two dollars get taxed for every one dollar withdrawn until the 85% ceiling is reached.
The cleanest fix for this situation is Roth conversions done before age 73. By moving traditional IRA dollars into a Roth across the 60s, a retiree shrinks the future RMD base, lowers lifetime taxable income, and keeps Social Security from being dragged into taxation. For our 73-year-old, that window has closed. Worth flagging for anyone still in their 60s with a large traditional IRA: the years between retirement and RMDs are the highest-leverage tax planning years of an entire financial life.
The Most Powerful Move Still on the Table
Qualified charitable distributions are the best tool she has left. A QCD lets her send RMD dollars directly from the traditional IRA to a qualified charity. The distribution satisfies the RMD requirement, but it never hits her adjusted gross income. If she already gives to a church, food bank, or any 501(c)(3), routing those gifts through the IRA instead of from checking is a free win.
Say she gives $10,000 a year to charity. Routing that through a QCD shaves $10,000 off the RMD that lands on her tax return. Provisional income drops, less of her Social Security is taxed, and her exposure to higher Medicare premium tiers (IRMAA) recedes.
If she needs spending money beyond the RMD, the question is where it comes from. Pulling another $20,000 from the traditional IRA stacks more taxable income on top of an already-taxed Social Security check. Pulling that same $20,000 from the $120,000 Roth costs her zero federal tax.
The 2026 Social Security COLA was 2.8%, which nudges her benefit higher and tightens these thresholds further. The $25,000 and $34,000 breakpoints have never been indexed to inflation, so every COLA pushes more retirees over the line.
A mistake to avoid: taking the RMD as a December lump sum, depositing it in a brokerage account, and then writing charity checks from that account. A QCD only counts if the money moves directly from the IRA custodian to the charity.
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