Forbes has published an article, “5 RMD Changes Looming With Passage Of SECURE 2.0 Act,” which discusses five provisions in the Secure 2.0 Act that holds the most influence in changing required minimum distributions (RMDs) policies. The article begins as follows:
Back when the SECURE Act passed in 2019, I wrote an article for Forbes called the “Why The SECURE Act Makes 2020 The Year of Missed RMDs.” The reality then was that the two biggest and most impactful provisions of the SECURE Act 1.0 were around required minimum distributions (RMDs) from retirement accounts.
With the passage of the SECURE 2.0 Act bill as part of a fiscal omnibus federal spending bill, RMD changes again loom large.
For a bit of background, retirement accounts were created to encourage Americans to save for retirement while working. These retirement accounts were given tax advantages, either tax- deferred growth or tax-free growth in the case of a Roth account. However, the government wanted people to eventually spend these accounts to fund retirement, so they put in rules around mandatory beginning dates for required minimum distributions.
They picked age 70½ as a general starting point to where you had to start taking distributions from retirement accounts. Due to longevity and the risk cost of retirement, Congress passed the SECURE Act in 2019 which pushed out the required beginning date to 72.
Now again, in 2022, Congress is looking to push back RMDs and make other significant RMD changes. Let’s take a quick look at five provisions that will impact RMDs moving forward as part of the SECURE 2.0 Act.
Click here to view the full article: “5 RMD Changes Looming With Passage of SeCURE 2.0 Act”
Posted by Melissa Zheng, Associate Editor, Wealth Strategies Journal.