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The New Retirement Plan Distribution Rules

In case you missed it, sweeping new rules on distributions from IRA And Qualified Retirement Plans (QRPs) went into effect at the beginning of 2022.

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With the pandemic, high inflation rate, Federal Reserve tightening and other crises preoccupying attention, it is understandable if you did not know about the important new rules affecting retirement planning.

On December 20, 2019, President Donald J. Trump signed into law the SECURE Act (Setting Every Community Up for Retirement Enhancement” Act). On February 23, 2022, the IRS issued proposed regulations implementing the law. These regulations detail specifics of how the new law is to be enforced.

While the rules are only proposed and have not been finalized, it is wise to update personal tax and financial plans based on rules proposed by the IRS. While they may be changed or augmented, acting as if proposed IRS rules are final is prudent. The new distribution IRA and QRP rules implement new tax law contained in SECURE Act regarding:

  • Required minimum distribution requirements
  • Distributions commencing during an employee's lifetime
  • Death before the required beginning date (RBD) for distributions
  • Who is a designated beneficiary?
  • Required minimum distributions (RMDs) from defined contribution plans
  • Required minimum distributions from defined benefit plans and annuity contracts
  • Rollovers and transfers from IRAs and QRPs
IRAs and other federally qualified retirement plans are central to personal financial planning, impacting estate and income tax as well as retirement planning. The new rules affect a complex and technical tax topic.

Nothing contained herein is to be considered a solicitation, research material, an investment recommendation, or advice of any kind, and it is subject to change without notice. Any investments or strategies referenced herein do not take into account the investment objectives, financial situation or particular needs of any specific person. Product suitability must be independently determined for each individual investor. Tax advice always depends on your particular personal situation and preferences. You should consult the appropriate financial professional regarding your specific circumstances.
The material represents an assessment of financial, economic and tax law at a specific point in time and is not intended to be a forecast of future events or a guarantee of future results. Forward-looking statements are subject to certain risks and uncertainties. Actual results, performance, or achievements may differ materially from those expressed or implied. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete, and is not intended to be used as a primary basis for investment decisions.
This article was written by a professional financial journalist for Advisor Products and is not intended as legal or investment advice.

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This article was written by a professional financial journalist for Falcon Financial Planning Inc. and is not intended as legal or investment advice.

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