Preserving Your IRA

The rules and regulations regarding individual retirement accounts (IRAs) and Workplace Retirement Accounts (401Ks, 403Bs, 457s, etc.) continue to increase in complexity.  In 2019, the SECURE ACT was passed and put into law some of the most sweeping changes we have seen in this area in years. They affect both you and your heirs. Three important pieces of the law that should be noted are:

  • The age at which required minimum distributions (RMDs) need to begin is now 72, not 70 ½
  • Contributions to IRAs can now be made indefinitely
  • Most non-spouses that inherit an IRA must now take distributions that end up emptying the account within 10 years (no more stretch option)

Additionally, the issue of taxes needs to be addressed. The federal income tax as we know it today was enacted in 1913. Between then and now, there have been many changes both raising and lowering the rates. So, the question is, what lies ahead for tax reform?  This issue needs to be paid close attention to.

For these reasons, if you want to try to preserve your retirement asset from unnecessary and excessive taxation, as well as irreversible mistakes with the IRS, you may want to consider working with a financial advisor who is also an IRA and tax specialist.

Drawing on my years of experience, my tax background and ongoing training, I have helped many clients navigate through the IRA maze. I would be happy to work with you as well in implementing a plan that addresses the various tax and inheritance rules surrounding IRAs and is designed to help avoid unnecessary income and estate tax penalties for you and your heirs.

Your IRA questions may include the following:

  • Traditional IRA or ROTH IRA? Which one, how much and why?
  • Should I do a Roth conversion? Do I need to recharacterize?
  • How do I accomplish a rollover or transfer?
  • Net Unrealized Appreciation (NUA) - does this apply to my 401K?
  • Will there be IRA penalties (excess contributions, excess accumulation and prohibited transactions)?
  • Required Distributions (RMDs) — when do I need to take a distribution and how much?
  • SEP IRAs/SIMPLE IRAs — can I fund these as well?
  • IRA Sec 72(T) rules — is this something I should consider?
  • Beneficiary designations (primary and contingent) — who should I name and why? Are they current on all my accounts?
  • What are my options for death distributions?
  • Can I leave my IRA to a charity?

For help answering any of these questions, please email me or call me at 203-481-1040.