Two Strategies That Beat the SECURE Act
There’s a tax bill attached to each traditional individual retirement arrangement (IRA) and 401(k), and Congress recently tried to accelerate and increase that tax bill.
That’s why, following enactment of the Setting Every Community Up for Retirement Enhancement (SECURE) Act, many IRA and 401(k) owners need to revamp their estate planning strategies.
As I’ve reported, the SECURE Act ends the Stretch IRA. When an IRA or other retirement plan is inherited, most of the time the beneficiaries must distribute the entire account within 10 years. There are exceptions for a surviving spouse, minor children, a disabled beneficiary and a few others. But in most cases, the ability to make the tax deferral of an inherited account last more than 10 years is eliminated.