No, it isn’t a tax on already taxed savings. None of the funds in a 401k have been taxed. A 401k is funded by pre-tax income and grows without taxation.
The failure to take a RMD precipitates a penalty. Penalties are not taxes.
The funds withdrawn from the 401k are treated as income and are taxed as such. But, these funds have not been taxed before.
I stand corrected.
Is there a better way to shield untaxed money ?