Sweeping Changes to Retirement and Required Minimum Distributions (RMD)

One of the biggest changes to RMD and tax planning in the last 20 years is now going into effect on Jan 1, 2020.  This is part of the SECURE act passed this week.

We will be hosting a workshop on January 21, 2020 at the Perry Hall MD Library to review all the details of this dramatic change.

REGARDING RMD IF YOU ARE NEAR AGE 70 1/2;

So, if you turn 70 1/2 by the end of 2019, you will need to start taking RMDs for 2019. The first one needs to come out by April 1, 2020. 

However, if you turn 70 1/2 after Jan. 1, 2020, you now won’t be required to take an RMD for 2020. In fact, no one will be required to take a 2020 RMD based on turning 70.5 in 2020 or turning 72 in 2020

REGARDING LIFE EXPECTANCY TABLES;
Expect new life expectancy tables for 2021 and beyond.  This will not have an impact for tax years 2019 or 2020. Again, these are the tables used to calculate your RMD for your DEC 31 retirement balances.  We will have more clarity on this for 2021, but the changes are certain.  

These changes, along with the 2018 income tax changes are the most sweeping of the past two decades.  It will erase a lot of financial and tax planning.  

On top of this, we will no longer be able to have the benefit of stretch IRA accounts in estate planning.  This will make billions for the Treasury, but put a hefty burden on your beneficiaries.  

Please contact our offices in West Chester, Wilmington DE, or White Marsh MD for additional information.   
Mark your calendar for our January 21 workshop. Space is limited. 

Press Contact:  B. Michael Shanley  (610) 515-5800  

*Information contained herein is not tax or financial advise. Please consult your advisor for your specific situation.