As we explained in this post, the SECURE Act passed by Congress at the end of 2019 changed many of the longstanding rules around IRA withdrawals, eliminating the so-called "stretch" IRA for many beneficiaries and delaying required withdrawals to age 72 for those born after June 30, 1949.
New Rules Apply with passage of the CARES Act
As we've just begun getting used to these new rules, as part of the CARES Act (Coronavirus Aid, Relief and Economic Security Act), Congress made some other changes applicable only for this year. These include:Read More
We reported on the SECURE Act when it was enacted at the end of 2019. (You can read about the rules it changed here.) Since then, we and other attorneys have been parsing it and learning a lot more about how its changes work and how they may affect clients. Here's some of our new learning:
1. Estates in Progress May Want to Disclaim
Except for eligible beneficiaries (spouses, minor children, and disabled or chronically ill individuals), those inheriting IRAs from decedents dying this year and in the future will have to withdraw and pay taxes on the inherited accounts within 10 years from the year of the original owners death. Those who inherited IRAs from people dying before this year can continue to "stretch" out the distributions through their own lifetimes.Read More
At the end of 2019, Congress passed new rules governing retirement accounts known as the SECURE Act, an acronym standing for Setting Every Community Up for Retirement Enhancement. A big part of the bill encourages small employers to band together to offer retirement plans, which is the reason for the title. But here's what may affect you and your family: