Retirement Social Security

Why Turning 73 Could Suddenly Cost You Part of Your Social Security Check

There's a less obvious reason your benefits might shrink that year.

By Maurie Backman , Edited by Laura Hohenstein

Updated Oct. 7, 2026

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If you're retired, your goal is probably to keep more of your money, not less. That means adopting a smart financial strategy.

For example, withdrawing from your retirement savings carefully could help keep your tax bill lower, allowing you to keep more of your income. Similarly, reviewing your spending regularly could help you avoid financial mistakes, such as wasting money on services, subscriptions, or other things you don't actually need.

But when it comes to Social Security, there's a less obvious reason your benefits could shrink once you turn 73, and you should be prepared for it.

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Why age 73 is significant for retirees

If you have your retirement savings in a traditional retirement account like an IRA or 401(k) plan, once you turn 73, you'll generally have to start taking required minimum distributions, or RMDs. For people who reach the applicable age after 2032, the RMD age rises to 75. RMDs are calculated based on your account balance and life expectancy, and they can change every year.

RMDs are due each year by Dec. 31, though you can defer your first one to April 1 of the year after you turn 73. If you don't take an RMD when you're supposed to, you risk a 25% penalty on whatever amount you do not withdraw by the deadline. Missing a $4,000 RMD, for example, could mean facing a $1,000 penalty.

However, there's a new tax break that could help some retirees offset the impact. For tax years 2025 through 2028, taxpayers age 65 and older may qualify for an additional $6,000 deduction ($12,000 for married couples if both spouses qualify).

The deduction begins to phase out when modified adjusted gross income exceeds $75,000 for single filers or $150,000 for married couples filing jointly.

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How RMDs impact your Social Security benefits

You may be wondering what RMDs have to do with Social Security. To understand the connection, you need to know when Social Security benefits are taxed.

Social Security benefits are subject to taxes based on your provisional income. Provisional income is calculated as your adjusted gross income (AGI) plus tax-exempt interest income you collect plus 50% of your yearly Social Security benefit amount. If your provisional income exceeds $25,000 as a single tax-filer or $32,000 as a married couple filing jointly, your Social Security benefits could be taxed.

RMDs, meanwhile, count toward your AGI. If you're forced to take withdrawals from your savings that drive up your AGI, you could end up with a provisional income that's high enough for your Social Security benefits to be subject to federal taxes.

How to avoid getting taxed on Social Security benefits

If you don't like the idea of paying taxes on your Social Security benefits, you'll want to make an important retirement savings decision while you're building your nest egg: keep your money in a Roth account.

There are many benefits to having money in a Roth IRA or 401(k). First, gains in these accounts are tax-free. Secondly, withdrawals during retirement are not subject to taxes. Third, Roth accounts do not impose RMDs.

If you withdraw from a Roth retirement account, it won't count toward your AGI. This means Roth withdrawals will not push you closer to owing taxes on your Social Security benefits.

This isn't to say that having money in a Roth IRA or 401(k) guarantees that your Social Security benefits won't be taxed. Other income streams may raise your AGI and provisional income. But with a Roth account, you won't have to worry about RMDs causing your benefits to be taxed.

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You can still reduce your RMDs if you're already retired

If you're already retired and are collecting Social Security benefits, you may be resigned to eventually having those monthly checks taxed once RMDs start. But if you're not old enough to have to take RMDs, you might still have an opportunity to get out of them or lower them.

If you're able to do a Roth conversion, where you move money from a traditional retirement plan to a Roth IRA, you may not have to take RMDs. Or, your RMDs may be small enough that they don't raise your provisional income to the point where you have to pay taxes on benefits.

Now, one caveat is that in the year you do a Roth conversion, you have to pay taxes on the amount you move into a Roth IRA. And that conversion could raise your AGI and cause you to owe taxes on your Social Security benefits. But it may be worth owing taxes on Social Security temporarily if it means getting out of them repeatedly in future years.

Bottom line

A big part of your retirement plan is figuring out how to maximize your senior benefits and keep as much of your money as you can. So the less tax you have to pay in total, the more retirement income you can enjoy.

It's important to understand how RMDs could result in having to pay taxes on your Social Security benefits. It's also smart to choose your retirement savings account carefully, or consider a Roth conversion if your current account will subject you to RMDs as you get older.

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