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Possibly—but there is no blanket 403(b) RMD exclusion at age 77. The required minimum distribution (RMD) age is generally 73, yet a current employee may be able to postpone RMDs from the 403(b) plan of the employer where she still works. The delay applies only if that written plan permits it and she is not subject to the IRS more-than-5% ownership rule. Other retirement accounts may still have RMDs due.
Because the answer depends on the plan document, ownership, account type and contribution history, ask the plan administrator to confirm her required beginning date and distribution deadline. The IRS describes the general rules in its RMD FAQ and Publication 571.
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What the still-working exception actually does
Federal rules generally require retirement-plan owners to begin RMDs at age 73. Reaching 77 therefore does not, by itself, create an exemption. Instead, the law can postpone RMDs from a workplace plan when the participant is still employed by the employer sponsoring that plan. This is commonly called the “still-working” exception.
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The exception is limited to the plan of the current employer. It does not automatically postpone distributions from an IRA, a former employer’s 401(k) or 403(b), or another plan. The plan can also choose to require distributions earlier than the tax-law maximum. The administrator must read the plan’s terms and apply them to your mother’s account.
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| Question | If the answer is yes | If the answer is no |
|---|---|---|
| Is she still employed by the employer sponsoring this 403(b)? | A retirement delay may be available. | The current-employer exception does not apply to this account. |
| Does the written plan allow the delay? | RMDs may wait until the plan’s stated retirement date. | The plan can require distributions under its earlier schedule. |
| Does she own more than 5% of the employer? | The 5% owner rule generally prevents the still-working delay. | Ownership does not block the exception on this ground. |
| Is the balance a designated Roth 403(b) account? | No lifetime RMD is required for the owner under current IRS guidance. | Pre-tax and non-Roth rules must be checked. |
The IRS explains the workplace-plan exception, Roth treatment and aggregation rules in its Retirement Plan and IRA Required Minimum Distributions FAQs.
How the deadline is calculated if the plan permits a delay
For post-1986 403(b) accruals, the required beginning date is generally April 1 of the calendar year after the later of two events: the year she reaches age 73 or the year she retires. That later-retirement rule applies only when the plan’s still-working provision is available. Publication 571 explains the 403(b) timing rules.
Example: she retires after age 73
Suppose she reached 73 in 2022 and remains employed until September 2026. If the plan permits the delay, her first RMD is generally due by April 1, 2027—the April 1 after the year she retires. Her second RMD for 2027 is generally due by December 31, 2027. That can result in two taxable distributions in the same calendar year.
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Example: the plan requires distributions while she works
If the written plan does not use the still-working exception, her first RMD would generally have been tied to the year she reached 73, with the first payment due by the following April 1 and later payments by each December 31. The administrator should calculate any amount already due rather than relying on her age alone.
After the first distribution, later RMDs are generally due by December 31 each year. Taking the first payment by April 1 does not eliminate the next year’s December 31 payment.
Account details that can change the result
Designated Roth 403(b) money
While the account owner is alive, a designated Roth 403(b) account does not require lifetime RMDs under the IRS FAQ. The plan must identify the money as a designated Roth account; do not assume that a Roth label elsewhere on a statement proves the account qualifies. Roth amounts still have distribution and beneficiary rules after death.
Pre-1987 403(b) accruals
Qualifying amounts accrued before 1987 can receive special later timing if the plan separately accounts for them and the records meet the IRS conditions. A balance that is not separately tracked generally follows the age-73 RMD rules. Ask whether the plan’s records identify pre-1987 accruals separately and whether the plan administrator has determined that the special treatment applies.
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A participant calculates the RMD for each 403(b) contract separately. She may generally take the combined total from one or more of her 403(b) contracts, subject to the plan administrators’ procedures. This 403(b) aggregation rule does not let her combine an IRA, 401(k) or another type of plan with the 403(b) total. Each account type has its own calculation and payment rules.
What to ask the plan administrator
Use a written request or secure message so the answers and dates are documented. Ask these questions in order:
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- Confirm the employer relationship. Is this the 403(b) sponsored by the employer where she is currently an employee, rather than a former employer’s plan?
- Request the plan’s still-working provision. Does the written plan allow a participant who remains employed to delay RMDs until retirement, and what event does the plan use to define retirement?
- Check the ownership test. Does she, directly or through applicable attribution rules, own more than 5% of the employer? The IRS Form 5329 instructions describe this owner threshold and its effect on the delay: Instructions for Form 5329.
- Identify account sources. Which contracts contain pre-tax money, designated Roth money or separately recorded pre-1987 accruals?
- Obtain the calculation. What is the plan’s calculated RMD for each contract, which life-expectancy table was used, and what account balance date applies?
- Get the exact deadline. If she retires, what is her required beginning date, and does the plan impose an earlier operational deadline for paperwork or payment?
- Ask about withholding and reporting. How will the distribution be coded on Form 1099-R, and what federal or state withholding choices are available?
Request a copy or citation to the controlling plan section. A customer-service representative’s informal statement is less reliable than the plan document and a written calculation.
How other retirement accounts fit in
The current-employer 403(b) exception does not suspend RMDs from accounts that are outside that plan. An IRA, a 401(k) from a prior employer, a governmental 457(b) plan or another 403(b) may have a separate required beginning date. An IRA owner generally cannot use the still-working rule to postpone an IRA RMD merely because she has a job.
Make an inventory listing every account, the employer or custodian, whether she still works for that sponsor, the account’s tax status and any RMD notice. Give that inventory to each administrator. Do not transfer or roll over an account solely to avoid an RMD without checking how the move affects the year’s distribution obligation.
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What happens if an RMD was missed
An RMD shortfall can trigger an excise tax. Publication 571 describes a 25% tax on the amount that should have been distributed, potentially reduced to 10% when the shortfall is corrected within the specified correction period. The tax and correction process depend on the facts, the year involved and current filing instructions; do not assume that a penalty applies until the plan confirms an amount was actually due.
If the administrator identifies a missed RMD, have the plan calculate the shortfall and distribute it as soon as practicable. Keep the administrator’s calculation, payment confirmation and explanation of the correction. The IRS instructions for Form 5329 explain how excise-tax reporting is handled and when relief may be available. A tax professional who regularly handles retirement-plan RMDs can help evaluate a waiver request or filing, but professional advice is not a substitute for obtaining the plan’s written determination.
A practical decision path for your mother’s case
- List every retirement account. Separate the current-employer 403(b) from former-employer plans, IRAs and any designated Roth account.
- Verify employment and ownership. Confirm that she is an active employee of the 403(b) sponsor and is not a more-than-5% owner.
- Read the plan terms. Obtain the summary plan description or the specific RMD section and check whether distributions can wait until retirement.
- Separate special balances. Ask the administrator to identify designated Roth money and any separately recorded pre-1987 accruals.
- Get dates in writing. Record the required beginning date, each annual December 31 deadline and any earlier administrative cutoff.
- Coordinate accounts separately. Arrange each IRA, 401(k) or other plan’s RMD with its own custodian; do not assume the 403(b) delay carries over.
- Escalate discrepancies. If statements, the plan document and the administrator’s calculation conflict, request a formal review before the deadline and retain all correspondence.
Common mistakes to avoid
- Calling it an age-77 exemption. The possible delay comes from current employment and plan terms, not from turning 77.
- Assuming every 403(b) permits the delay. Plans may require distributions earlier.
- Using the exception for a former employer’s account. The rule is tied to the current employer’s plan.
- Ignoring ownership. More-than-5% ownership generally defeats the still-working delay.
- Mixing account types. A 403(b) distribution cannot automatically satisfy an IRA or 401(k) RMD.
- Waiting for a tax notice. The account owner is responsible for taking RMDs; the absence of a reminder does not erase a due date.
- Forgetting the two-payment year. Delaying the first RMD until April 1 can create another RMD due by December 31 of that same year.
Bottom line for a 77-year-old still working
Your mother may be able to delay RMDs from her current employer’s 403(b) until retirement, but only if the plan permits the delay and she is not a more-than-5% owner. Designated Roth money has no lifetime owner RMD, while qualifying separately recorded pre-1987 amounts may follow special timing. Every other account must be reviewed under its own rules. The safest next step is a written plan-administrator determination of her account types, ownership status, required beginning date and payment deadlines.
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