In December 2019, Congress passed The Setting Every Community Up for Retirement Enhancement Act or The SECURE Act. This law is the first significant retirement-related legislation since the Pension Protection Act of 2006, and it contains measures that will affect both individuals and businesses. Let’s take you through some of the notable changes, all of which went into effect on January 1, 2020:
Changes Affecting Employees & Individual Taxpayers
Changes Affecting Inherited IRAs
It’s important to note that the age of the decedent is no longer considered when calculating the payout period for inherited IRAs. A limited group of beneficiaries may continue to “stretch” distributions over their life expectancy:
However, individual beneficiaries not included above must withdraw the entire account by the end of the 10th calendar year following the death of the decedent. Any non-individuals (such as a charity or certain trusts) must withdraw the entire account balance by the end of the 5th calendar year following the death of the decedent.
Who Should Review and Update Their Estate Plans as Soon as Possible?
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