Every December, my clients over age 70 &1/2 want to know why they have to withdraw funds from their qualified retirement accounts. Here is the easy explanation:
Why does the government force you to make withdrawals from your retirement account? Because they want those tax bucks. Remember, when you put money into your IRA, you got a tax deduction. As the account grew, you paid no tax whatsoever. Now, the government wants its money.
There are other questions that generally are asked by those taking their RDM as follows:
Which investments should I sell to raise funds for the withdrawal?
You can choose any investment to sell. Many of my clients like to look at which holdings have gains and will sell the gains to satisfy the RMD amount. Other clients will pull a little from each holding. There is no right or wrong.
Can I still give some of my RMD directly to charity?
Yes, you can have the amount you wish sent directly from your retirement account to your charity of choice and have that satisfy your RMD.
What happens if I don’t take my RMD on time?
Your will pay a 50% penalty tax on what you should have withdrawn.

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