Congress has recently made significant changes to retirement plan rules. Previously, traditional IRA contributions weren’t allowed once you turned 70 ½. Starting in 2020, the new rules allow an individual of any age to make contributions to a traditional IRA, if, he or she has compensation.
The new law also increases the age required minimum distributions from certain retirement accounts must begin from 70 ½ to 72.
Another change is a rule regarding inheriting IRAs, previously referred to as “stretch IRA”, which allowed the retirement benefits to be paid out over the life of the beneficiary. Now the heir will be required to completely withdraw all plan assets within ten years of the date of death.
If you have any questions on how these changes can impact your taxes, please call us at ADKF.