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What Does the SECURE Act Mean for Your Retirement?


If you have followed the news in regards to retirement, you know that multiple sources have referenced the lack of retirement savings among retirees and older people. While this isn’t isolated to America, the Fed reports about 25% of Americans don’t have a retirement plan in place. With declining policies in place to take care of Americans post-retirement, retirement accounts and financial knowledge is more important than ever. While the SECURE Act doesn’t specifically address all the financial issues when it comes to retirement, it does allow some solid options for Americans.


RMDs to start at age 72 instead of 70 ½. First and foremost, the SECURE Act increases the age in which you need to start required minimum distributions from traditional retirement accounts. While the change from 70 ½ years old to 72 is only 1 ½ years, this allows retirement accounts to continue gaining interest while also allowing the account holder to hold off on paying interest on the money.


You can contribute to traditional IRAs after age 70 ½. There is no longer an age cap on a traditional IRA, similar to a Roth IRA. After 70 ½ years old, participants can continue to contribute money to the retirement account, provided they have earned income. This is especially helpful for not-so-retired retirees.


More Annuity Options with 401(k) plans. Another positive note is the addition of improved legal coverage for employers with hopes that this will lead to more options in the annuity realm. Traditionally, the liability was too much for most companies to offer an option like this in a 401(k). They were even able to offer 401(k) options to part-timers as long as they fulfill a short list of requirements. Small businesses gained a boost as well, with potential to offer 401(k) options through economies of scale.


Your tax bill on inherited IRAs will come sooner. The bill also essentially eliminates the “stretch IRA,” an estate planning method that allows IRA beneficiaries to stretch out their distributions from their inherited account and the required tax payments that come with it. Under the new law, most beneficiaries will be required to withdraw all the distributions from their inherited account and pay taxes on it within 10 years.


Talley’s experienced team of tax professionals provides comprehensive tax compliance and consulting services so you can preserve, enhance, and pass on to the next generation the assets and wealth that you’ve worked hard to build. We welcome the opportunity to discuss the current opportunities available to you. For more information, contact us today.

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