On Jan. 1, 2020, Congress passed the Secure Act, which completely overhauled federal retirement plan laws. These changes affect all qualified retirement plans including 401(k)s, 403(B)s, TSPs and both traditional and Roth IRAs.
Although the law establishes a new beginning date of age 72 for required minimum distributions (RMDs), most of the major changes occur when the retirement plans pass to the next generation. Most individuals will therefore continue to take RMDs based upon their own life expectancy and a surviving spouse will likely exercise the spousal roll-over option making the plan their own. This conventional planning technique defers the “snap-shot” date until the survivor’s death thus maximizing full tax deferral.
Once the plan participant and spouse have both passed away, the plan becomes an Inherited IRA. Under the old laws, a beneficiary would take their own minimum distributions beginning year one after the participant’s death based upon their own actuarial life ...
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