Hi, I'm Christine Benz for Morningstar.Required minimum distributions are on hold for 2020
Time is running out to take advantage of certain retirement- and tax-related provisions in the Coronavirus Aid, Relief, and Economic Security (CARES) Act which are set to expire on Dec.31, 2020.
Individual retirement accounts have strict rules for depositing and withdrawing money.But there are exceptions, and one of them is attracting attention these days—“substantially equal periodic payments.”
Often referred to as 72(t) plans, this option allows those under the age of 59½ to withdraw funds early from their traditional IRA accounts, for any reason, without paying the usual early-withdrawal penalty of 10% on top of the regular taxes.
“Make sure you commit to the payment plan,” says Sarah Brenner, Director of Retirement Education at Ed Slott & Co., a tax-consulting firm in Rockville Centre, N.Y.“You really need to be sure you want to be locked into the payment plan for a long duration.”
Ed Slott, the Rockville Centre, New York-based CPA, editor of the newsletter Ed Slott’s IRA Advisor, and author of “The New Retirement Savings Time Bomb” (Penguin Books), to be released in March, recently talked to ThinkAdvisor with some advice about how tax law changes.Here are excerpts from our interview:
With jobs to hold down, children to care for, friendships to maintain, food to be bought and cooked, dishes to be washed and laundry to be done, it can be a challenge to keep up with all the details of your personal finances.
In passing, you may wonder: How many more months until my car loan is paid off?Or, before bed, you may get a jolt of anxiety about whether you’ll ever be able to retire.
President-elect Joe Biden hopes to encourage lower- and middle-income workers to save more by changing the existing tax preferences for savings in retirement accounts.A divided Congress is likely to hinder his plans.
It’s a common end-of-year refrain: Don’t forget to take your required minimum distribution.
But, just as with everything else in 2020, rules for RMDs, as they are generally known, are different this year.Seniors don’t have to take them.
Ed Slott, Founder of IRAhelp.com, joins The Final Round to discuss how the election could impact your retirement savings.
Estate attorneys, certified public accountants (CPAs) and the very wealthy will likely go to war with the federal government should former Vice President Joe Biden assume the Oval Office.The issue at hand
