Avoiding Common Mistakes in Managing Qualified Funds RMDs: Tips from Financial Experts

Retirement is often talked about as one universal experience. It isn't. For women, the path into retirement carries different math, different risks, and different decisions — and the numbers make the case clearly. The Numbers Women Are Retiring Into Women retiring today have, on average, roughly $70,000 less saved than men — $261,763 versus $330,305, according to a 2026 survey of American retirees (Clever Real Estate/LendingTree, 2026). The gap shows up earlier, too. Vanguard's 2026 How America Saves report found the average 401(k) balance was $146,476 for women compared with $194,597 for men — even though women, at comparable income levels, participate in workplace plans at higher rates and often save a larger share of their paycheck (CNBC/Vanguard, 2026). Social Security reflects the same gap: women receive meaningfully lower average monthly benefits than men, largely because benefits are calculated from lifetime earnings, and women's earnings and time in the workforce are frequently interrupted by caregiving (CNBC, 2026). Women also need that smaller nest egg to stretch further. As of 2025, average U.S. life expectancy is 81.1 years for women versus 75.8 years for men — meaning a longer retirement has to be funded with less (Morgan Stanley at Work, 2025, citing CDC data). None of this is a reflection of poor planning. It's the compounding effect of the wage gap, career interruptions for caregiving, and longer lifespans — and it's exactly why the decisions made in the weeks around leaving a job matter more for women than the average retirement article lets on. Before You Walk Out the Door: A Transition Checklist The period when you leave your job — whether by choice, layoff, or a caregiving decision — is when the most consequential (and most reversible) mistakes happen. A few things worth putting on your list before your last day: 1. Know your health insurance bridge. If you're retiring before age 65, you have a Medicare gap to cover. A spouse's plan, or a Marketplace plan are the usual options — each with different costs and enrollment windows that don't wait for you to decide later. 2. Don't let your 401(k) or pension election happen by default. Rolling over a 401(k), choosing a pension payout option (lump sum vs. annuity, single-life vs. joint-and-survivor), and deciding what happens to employer stock are decisions that are difficult or impossible to undo once made. If you're married, a joint-and-survivor pension election specifically protects a surviving spouse — worth understanding given that women are statistically more likely to be the surviving spouse. 3. Get clear on your Social Security timing. Claiming early versus waiting until full retirement age or later changes your benefit for the rest of your life. Given the longevity numbers above, the "wait if you can" math often works differently — and more favorably — for women than the generic advice assumes. 4. Account for unused PTO, severance, and final-paycheck timing. These affect the tax year your final income lands in, which can matter for Medicaid/VA planning down the road as well as ordinary tax planning. 5. Revisit your estate documents. A job change or retirement is a natural checkpoint to confirm your power of attorney, medical directives, and beneficiary designations are current — especially if they haven't been touched since you started that job. The Blind Spot Most Retirement Plans Miss: Long-Term Care This is where the wealth gap turns into something more personal. Women aren't just retiring with less — they're also more likely to need paid long-term care, and to need it for longer: 51% of women 65 and older will need paid long-term care in their lifetime, compared with 39% of men (American Association for Long-Term Care Insurance, 2024). On average, women need long-term care about 1.5 years longer than men (Administration for Community Living, 2020, cited in SingleCare, 2026). Women make up roughly two-thirds of long-stay nursing facility residents (Morningstar, 2023). At the same time, women are also the ones most often providing unpaid care — for a spouse, a parent, or both — often at real cost to their own careers and savings. Put together: women are more likely to need care, more likely to need it longer, more likely to be caring for someone else first, and are doing all of this with a smaller financial cushion. That combination is exactly why long-term care and Medicaid planning aren't a "someday" conversation — they're part of the retirement conversation. How SRC Texas Helps This is the work we do every day at Senior Resource Center of Texas. We're not a general financial planning firm bolting on elder law — Texas Medicaid (MEPD) planning, VA benefits, and elder law case management are the core of what we do, alongside retirement and annuity planning and estate planning. In practice, that means we help clients: Build a retirement income plan that accounts for the real gaps women face — including annuity and retirement planning guidance from our team. Protect a spouse's income and home through Medicaid spousal impoverishment planning if long-term care becomes necessary. Navigate VA benefits available to veterans and surviving spouses. Put estate planning documents in place — or update ones that are years out of date — so decisions are already made before a crisis forces them. Handle the HHSC paperwork, appeals, and case management that Medicaid planning requires, so you're not doing it alone during an already stressful time.  If you're approaching a job transition, retiring, or supporting a parent or spouse through one, the best time to have this conversation is before the decisions above are locked in — not after. Senior Resource Center of Texas 4408 Spicewood Springs Rd, Austin, TX 78759 (512) 835-0963 | srctexas.com This article is for general educational purposes and isn't individualized financial, legal, or tax advice. Your specific situation should be reviewed with our team before making retirement, Medicaid, or estate planning decisions.

By Senior Resource Center of Texas • April 2026 • 7-min read Tax season raises real questions for seniors and their families — especially when income sources shift, Medicaid is in the picture, or you've heard about new tax laws. Here's what every Texas senior needs to know about 2025 federal tax filing requirements, the new $6,000 senior deduction, and how to get free help. The Basic Question: Do You Have to File? The short answer is: it depends on your income, your age, and your filing status. Most seniors are pleasantly surprised to find they don't have to file at all — but there are important exceptions. If your gross income (all taxable income, not counting Social Security benefits in most cases) is below the IRS threshold for your situation, you're generally off the hook. Syndicated senior journalist Jim Miller, writing for Savvy Senior, and confirmed by IRS Publication 554, lays out the 2025 thresholds clearly: Filing Status Under Age 65 Age 65 or Older Single $15,750 $17,750 Married Filing Jointly – one spouse 65+ — $33,100 Married Filing Jointly – both 65+ — $34,700 Married Filing Separately $5 at any age $5 at any age Head of Household $23,625 $25,625 Qualifying Surviving Spouse $31,500 $33,100 "For most people, it's straightforward: if your gross income is below the threshold for your filing status and age, you generally don't need to file. But if it's over, you will." — Jim Miller, Savvy Senior When You Still May Need to File Even if your gross income falls below the threshold, certain situations can trigger a filing requirement. According to Savvy Senior and Audicus's 2026 senior tax guide, you'll likely need to file if any of the following apply: Special Filing Triggers for Seniors • More than $400 from self-employment — even part-time or freelance work • Taxes owed on an IRA, Health Savings Account, or alternative minimum tax • You or a dependent received Health Insurance Marketplace premium tax credits • You took a distribution from a 401(k) or traditional IRA • You received Form 1099-C reporting canceled debt • Social Security plus other income exceeds $25,000 (single) or $32,000 (joint) — a portion becomes taxable Not sure? The IRS offers an online tool at IRS.gov/help/ita — click "Filing Requirements – Do I Need to File?" It takes less than 15 minutes. The Big New Benefit: A $6,000 Senior Deduction NEW 2025–2028 One of the most significant tax changes for older Americans in years. Beginning with the 2025 tax year, individuals age 65 and older can now claim an additional $6,000 deduction — on top of both the standard deduction and the existing extra senior deduction — thanks to the One Big Beautiful Bill Act. H&R Block, Jackson Hewitt, and TurboTax all confirm: this deduction is available whether you itemize or take the standard deduction, and is built right into Form 1040 or 1040-SR. New $6,000 Senior Deduction — Key Facts • Who qualifies: Age 65+ by December 31, 2025; valid Social Security number; any filing status except Married Filing Separately • Income limits: Full deduction for MAGI at or below $75,000 (single) / $150,000 (joint). Phases out above those thresholds • Married couples: If both spouses are 65+, the combined deduction is $12,000 • Duration: Tax years 2025 through 2028 only — this is a temporary benefit • How to claim: Check the "65 or older" box on Form 1040 or 1040-SR — the IRS applies it automatically To illustrate: a single filer age 68 would receive the $15,750 base standard deduction, plus $2,000 extra for being 65+, plus up to $6,000 from the new senior deduction — for a total possible deduction of $23,750 before any income is taxed. A significant change from prior years. Other Tax Benefits Seniors Should Know About Required Minimum Distributions & Charitable Giving If you turned 73 in 2025, you are now required to take annual withdrawals (RMDs) from your IRAs. However, if you're 70½ or older, you can make a Qualified Charitable Distribution (QCD) of up to $108,000 directly from your IRA. This counts toward your RMD and is excluded from your taxable income — a double benefit that can also help you stay below income thresholds for other deductions. Medical Expense Deduction If you itemize, qualified medical expenses exceeding 7.5% of your adjusted gross income are deductible. Wellabe estimates the average 65-year-old will spend around $172,500 on healthcare over their lifetime — so this deduction can be substantial. Capital Loss Deduction Sold investments at a loss? You can deduct up to $3,000 per year against ordinary income, and carry forward larger losses to future tax years. Credit for the Elderly or Disabled Seniors age 65+ (or permanently disabled retirees under 65) may qualify for a federal tax credit ranging from $3,750 to $7,500. Use IRS Schedule R to determine your eligibility. Long-Term Care Insurance Premiums If you itemize and carry a qualified long-term care insurance policy, a portion of your premiums may be deductible — especially valuable for those already planning for future care costs. Free Tax Help for Texas Seniors There is no shortage of free, trustworthy resources for seniors who need help filing: Free Filing & Counseling Resources • IRS Free File at IRS.gov/freefile — Available if your 2025 AGI is $89,000 or less. Takes under 15 minutes. • Tax Counseling for the Elderly (TCE) — IRS-sponsored, free prep and counseling for taxpayers age 60+. Call 800-906-9887. • AARP Foundation Tax-Aide — Free for all ages; no AARP membership needed. Visit AARP.org/findtaxhelp or call 888-227-7669. • IRS Form 1040-SR — Senior-friendly form with larger print and a built-in standard deduction table. Available at IRS.gov. • IRS Helpline: 800-829-1040 The Medicaid & Tax Planning Connection At Senior Resource Center of Texas, we specialize in Medicaid planning — and tax season is a reminder that income reporting and Medicaid eligibility are more connected than most people realize. Two situations where tax decisions can directly affect Medicaid: • RMDs as countable income: In certain Medicaid programs, required minimum distributions count as income for eligibility purposes. The timing and amount of RMDs can matter significantly when approaching a Medicaid application. • QCDs as a planning tool: A Qualified Charitable Distribution bypasses your 1040 income line entirely — which can help keep income below Medicaid thresholds while satisfying your IRA withdrawal obligation. If you're navigating a Medicaid application, long-term care planning, or VA benefits alongside this tax season, please reach out to our office before making major financial decisions. Early planning can protect both your eligibility and your family's financial security. We're Here to Help. SRC Texas specializes in Medicaid planning, VA benefits, and retirement & estate planning for Central Texas seniors. If you have questions about how your finances affect your benefits — or just need a trusted resource — call us. 512-835-0963 | srctexas.com | Cedar Park & Austin, TX Sources & References 1. Jim Miller, Savvy Senior. "Do I Need to File a Tax Return This Year?". Seniorific.com, 2026 tax season edition 2. IRS Publication 554. Tax Guide for Seniors (2025). irs.gov/publications/p554 3. IRS Newsroom. One Big Beautiful Bill Act – Tax Deductions for Working Americans and Seniors. irs.gov 4. H&R Block. What Is the 2025 Standard Deduction for Over 65?. hrblock.com (October 2025) 5. Jackson Hewitt. New $6,000 Tax Deduction for Seniors. jacksonhewitt.com (2026) 6. TurboTax / Intuit. Tax Counseling for Seniors and the Elderly. turbotax.intuit.com (March 2026) 7. Wellabe. Tax Help for Seniors: How to Make Filing Easier This Year and Next. wellabe.com (2026 season) 8. Audicus. When Can Seniors Stop Filing Taxes? 2025 Rules by Income & Age. audicus.com (January 2026) 9. National Tax Reports. Tax Deductions for Seniors in 2025 & 2026. nationaltaxreports.com (March 2026) 10. Rep. Dan Meuser. Enhanced Deduction for Seniors – FAQ. meuser.house.gov (2025)