One of the greatest benefits offered under ERISA are the anti-alienation provisions, which provide that benefits under a pension plan cannot be assigned or alienated. While there are some statutory exceptions, ERISA essentially prevents retirement assets from being joined in any legal process to collect a commercial debt. These actions include garnishment, attachments, and other similar legal devices. There are some exceptions to this rule, the most obvious being divorce or legal separation.
An early start on tax planning is always good, but this year it is essential. The Tax Cuts and Jobs Act fully rewrites the tax code effective January 1, 2018. To get the most benefit from the changes, while avoiding mistakes under them, update your tax and financial strategies right away.
In 2014, the Tax Court ruled that an IRA owner could do only one, IRA-to-IRA or Roth IRA-to-Roth IRA, 60-day rollover in a 12 month period. This rule applies no matter how many IRA and/or Roth IRA accounts the IRA owner might have. The 12 months is a full 12 months, not a calendar year. The 12 month period will start with the date that IRA or Roth IRA funds are received.
If you have an IRA, you should realize that what goes in must come out. In other words, your tax deferral will not last forever. Eventually, Uncle Sam will want his share. When you reach retirement age, required minimum distributions (RMDs) will kick in. Are you prepared? Take our RMD quiz and see how well you understand the basic RMD rules.
Another historic event for Same Sex Marriages happened on Wednesday, September 14, 2016. That is when the U.S. Department of Treasury and the Internal Revenue Service (IRS) released final regulations amending the definitions of “marriage” and “husband and wife” in the wake of the Supreme Court’s Obergefell v. Hodges decision which legalized same-sex marriage, and the Windsor v. U.S. decision, which struck down Section 3 of the Defense of Marriage Act (DOMA).
I like to ask clients “If what you thought to be true turned out not to be true, when would you want to know? Since the beginning of mankind, people have been told things that turned out not to be true. The World is Flat. Radio has no future (Lord Kelvin 1897). The horse is here to stay, but the automobile is only a novelty – a fad. (Advice from a president of Michigan Savings bank to Henry Ford’s lawyer. Horace Rackham). What if you were told you are not part of an employer retirement plan but you really were? What could be the implications?
The word “rollover” is used frequently in writing and talking about distributions from retirement plans. Many times it is used incorrectly. It is crucial that retirement account owners and their advisors know the meaning of the word rollover to safegaurd their savings.
Distributions taken from an IRA before attaining the age of 59 ½ are generally subject to an early distribution penalty of 10% of the taxable amount of the distribution. Congress put the penalty in place to deter IRA owners from using their funds before their retirement. However, Congress also realized that sometimes we really do have a need for these funds so they made some exceptions to the penalty. One of these exceptions is the disability exception. But there is a catch.
Distributions taken from an IRA before attaining the age of 59 ½ are generally subject to an early distribution penalty of 10% of the taxable amount of the distribution. Congress put the penalty in place to deter IRA owners from using their funds before their retirement. However, Congress also realized that sometimes we really do have a need for these funds so they made some exceptions to the penalty. One of these exceptions is the disability exception. But there is a catch.
Are you considering converting your traditional IRA to a Roth IRA in 2016? If you are making this important decision, here are 6 things you will want to know.
