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The SECURE Act
How these changes affect your clients.
On December 20, 2019, the SECURE (Setting Every Community Up for Retirement Enhancement) Act was signed in to law effective January 1, 2020, and was put in place to strengthen retirement security across the country.
In this bill, there are many changes, both major and minor, that have a direct impact on your business practices and your clients. Below are some of the major changes.
In this bill, there are many changes, both major and minor, that have a direct impact on your business practices and your clients. Below are some of the major changes.
Major Changes:
- No age limit on earned income Traditional IRA contributions (previously 70½).
- Required Minimum Distribution (RMD) age increase from 70½ to 72.
- IRS penalty-free distribution (for under age 59½) with birth of a child or adoption; completed within one year of event and $5,000 maximum.
- 401(k) providers may now offer lifetime income options.
- Changes to IRA death payout options (for deaths January 1, 2020 and beyond).
- Beneficiaries who do not have a special circumstance (see below) will have their funds placed in a 10-year holding account.
- Removes the Beneficiary IRA option for non-eligible beneficiaries.
- Yearly RMDs are not required.
- All funds must be withdrawn by the end of the 10th year from the date of death.
- Eligible beneficiaries who are a spouse, disabled person, chronically ill person, a minor until age of majority, or a non-spouse beneficiary who is not more than 10 years younger (year of death attained age) are eligible for a "stretch" Beneficiary IRA with a yearly RMD based on their life expectancy. A Spouse may still elect a continuation or transfer of funds.
- A Non-Natural Person beneficiary (trust/estate/charity) will fall under the previous 5-year payout option.
If you have further questions or comments, please reach out to your GBU Sales Manager.
Kirk Dietrich
National Sales Manager
814-504-3562
kirk.dietrich@gbu.org
Don Ingalls
Home State Regional Sales Manager
MD, PA & WV
kirk.dietrich@gbu.org
Don Ingalls
Home State Regional Sales Manager
MD, PA & WV
412-576-2631
don.ingalls@gbu.org
Pamela McCloskey, ALMI
Midwest Regional Sales Manager
IL, MN, WI & MO
630-297-5557
pamela.mccloskey@gbu.org
Chris Russen
don.ingalls@gbu.org
Pamela McCloskey, ALMI
Midwest Regional Sales Manager
IL, MN, WI & MO
630-297-5557
pamela.mccloskey@gbu.org
Chris Russen
Great Lakes Regional Manager
IN, MI & OH
419-265-0387
chris.russen@gbu.org
IN, MI & OH
419-265-0387
chris.russen@gbu.org