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You may have heard that last month President Trump signed into law the SECURE Act, which aimed to increase access to retirement savings. Among other provisions, here are a few highlights from the law*. Contact our office today to learn what these and other provisions of the law mean for your unique situation.
Relief for small businesses
Attention all employers of small businesses – the law simplifies safe harbor 401(k) rules as well as increases incentives for plan startups and automatic enrollment.
No max age
While Traditional IRA contributions used to be limited to individuals under age 70 ½, now anyone with earned income can contribute, regardless of age.
The required beginning date for traditional IRA and employer retirement plan distributions has been pushed from age 70 ½ to 72, allowing more time for accounts to grow tax-deferred.
The law provides a safe harbor for employer-sponsored plans to offer annuities and other lifetime income products. As a result, we will likely see an increase in 401(k)s offering annuities as an investment option.
Goodbye stretch IRAs
Except for a few exemptions, including spouses and disabled persons, those inheriting retirement plans will no longer be able to stretch distributions over their lifetimes (a common estate planning technique) and instead must withdraw all assets within 10 years.