On December 20, 2019 the President signed into law the Setting Every Community Up For Retirement Enhancement (SECURE) Act. Three key provisions include:
1. Increase in age for required minimum distribution (RMD) for retirement accounts to 72 (up from 70 ½).
This change applies to distributions required to be made after December 31, 2019, with respect to individuals who attain age 70 ½ after such date.
2. You can make IRA contributions beyond age 70 ½
The prohibition on making deductible contributions to a traditional IRA after age 70 ½ is repealed. As Americans live longer, an increasing number continue employment beyond traditional retirement age.
3. “Strech RMD”
Imposes a 10-year distribution limit for most non-spouse beneficiaries to spend down inherited IRAs and defined contribution plans. Before passage of the Act, withdrawals from inherited accounts could be stretched over the life of beneficiaries to mitigate taxes.
- THE SETTING EVERY COMMUNITY UP FOR RETIREMENT ENHANCEMENT ACT OF 2019 (THE SECURE ACT); House Committee on Ways and Means
- The Top 10 Provisions of the Setting Every Community Up Fore Retirement Enhancement (SECURE) Act; Prepared for LPL by Davis & Harman LLP
This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.