Four retirement decisions come up again and again at year-end: borrowing from a 401(k), converting to a Roth, taking money from an inherited IRA, and working while collecting Social Security. Each has its own clock. Here is how to tell which rules apply to you and when each deadline falls.
| Your situation | The rule to check | Calculator |
|---|---|---|
| You need cash and have a 401(k) balance | 401(k) loan limit and 5-year repayment (IRC 72(p)) | 401(k) loan calculator |
| You need regular income from an IRA before 59 1/2 | Substantially equal periodic payments under IRC 72(t) and Notice 2022-6, kept up for 5 years or until 59 1/2 | 72(t) SEPP calculator |
| You plan to convert IRA money to a Roth, or withdraw from a Roth before 59 1/2 | Each conversion’s own 5-year clock and the ordering rules | Roth IRA 5-year rule calculator |
| You inherited an IRA from someone other than your spouse | The 10-year rule, plus annual RMDs if the owner had started RMDs | Inherited IRA RMD calculator |
| You collect Social Security before full retirement age and still work | The retirement earnings test | Social Security earnings test calculator |
| Action | Deadline | What happens if you miss it | Rule |
|---|---|---|---|
| Roth conversion that counts for 2026 | December 31, 2026 | It counts for 2027 instead, and its 5-year clock starts January 1, 2027 | Pub. 590-B; IRC 408A(d)(3) |
| 2026 IRA or Roth IRA contribution ($7,500; $8,600 at 50+) | April 15, 2027 (filing deadline, extensions do not count) | The 2026 limit is lost | IRS Notice 2025-67; Pub. 590-A |
| Inherited IRA annual RMD for 2026 (owner had started RMDs) | December 31, 2026 | 25% excise tax on the shortfall, 10% if corrected promptly | T.D. 10001; IRC 4974 |
| Empty an inherited IRA under the 10-year rule | December 31 of the 10th year after the death (2034 for a 2024 death) | Excise tax on everything left | Pub. 590-B |
| Your own first RMD | April 1 of the year after you turn 73; every later one by December 31 | 25% / 10% excise tax | Pub. 590-B |
| 401(k) loan payments | At least quarterly, paid off within 5 years (longer for a home purchase) | The unpaid balance becomes a taxable distribution | IRC 72(p)(2)(B)-(C) |
| Roll over a 401(k) loan offset after leaving your job | Your tax return due date for that year, including extensions | The offset is taxable, plus 10% if under 59 1/2 | IRC 402(c)(3)(C) |
| Social Security earnings test year | Calendar 2027 earnings: $25,560 limit under full retirement age, $67,920 in the year you reach it | $1 of benefits withheld per $2 (or $3) over the limit | SSA 2027 COLA fact sheet |
A plan loan is limited to the lesser of $50,000 and half your vested balance; plans may allow up to $10,000 even when that is more than half. The $50,000 is also reduced by your highest loan balance in the past 12 months.
| Vested balance | Maximum loan |
|---|---|
| $15,000 | $10,000 |
| $40,000 | $20,000 |
| $60,000 | $30,000 |
| $100,000 | $50,000 |
| $150,000 | $50,000 |
The interest goes back into your own account, but the borrowed money is out of the market and repaid with after-tax dollars. The real risk is leaving the job: most plans offset the unpaid balance, and you then have until your tax-filing deadline, with extensions, to put that amount into an IRA or it becomes taxable.
A conversion is taxed in the year you make it, and each one starts its own 5-year clock on January 1 of that year. Withdraw the converted money before the clock runs out and before 59 1/2, and the 10% penalty applies to the part that was taxable. Separately, earnings are tax-free only after five years from your first Roth contribution of any kind. Withdrawals always come out in the same order: regular contributions, then conversions oldest first, then earnings. A conversion made by December 31, 2026 is penalty-free to withdraw from January 1, 2031.
The final regulations (T.D. 10001, July 2024) settled the question heirs had asked since 2020: if the owner had already started RMDs, a non-spouse heir must take an annual RMD in years 1 to 9 and still empty the account by the end of year 10. The IRS waived the excise tax on missed amounts for 2021 through 2024; from 2025 they are required. An adult child who was 50 in 2025, inheriting $300,000 from a parent who died in 2024 at 78, divides by 35.2 for 2026 ($8,522.73) and 34.2 for 2027 ($8,771.93 on the same balance). If the parent had died before RMDs began, nothing is due until the 2034 deadline, though spreading withdrawals usually costs less tax than one large final year. Unlike an inherited house or brokerage account, an inherited IRA gets no step-up in basis: pre-tax dollars are ordinary income when withdrawn (the inherited property basis calculator shows the step-up for other assets).
Before full retirement age, Social Security withholds $1 of benefits for every $2 you earn above $25,560 in 2027; in the calendar year you reach full retirement age the limit is $67,920 and the withholding is $1 for every $3, counting only months before your birthday month. Earning $45,000 in 2027 under full retirement age means about $9,720 withheld; earning $80,000 in your full-retirement-age year, about $4,027. Withheld benefits are not lost: your benefit is recalculated at full retirement age to credit the months that were withheld.
December 31, 2026. Unlike contributions, conversions cannot be made for the prior year after the year ends, and they cannot be undone.
Only if the original owner had reached their required beginning date. Then you take an annual RMD in years 1 to 9 and empty the account by the end of year 10.
The lesser of $50,000 and half your vested balance (some plans allow up to $10,000 regardless), reduced by your highest loan balance in the past year.
Most plans offset the unpaid balance against your account. You can avoid tax by depositing that amount in an IRA by your tax-filing deadline, including extensions.
$25,560 if you are under full retirement age all year, and $67,920 in the year you reach it, according to the Social Security Administration.
Yes. Each conversion year starts a separate 5-year period for the 10% penalty; the 5-year period for tax-free earnings starts once, with your first Roth contribution.