Question:Hi,My last remaining parent, my mother, passed away in May 2017, and my younger brother and I inherited her IRA (equally split into inherited IRA accounts). We were of the understanding we could handle required minimum distributions (RMDs) via the “stretch IRA” method (RMDs spread out over our expected lifetime). The new laws that went into place in 2020 and 2022 have us wondering if we must change what we are doing. Can you please help us with this question?
Previous Slott Report articles have covered the new SECURE 2.0 provision allowing 529 funds to be rolled over to Roth IRAs. We’ve reported that there are several unanswered questions concerning this new rollover opportunity. And we’ve discussed the ability to do two rollovers in 2024 – one for 2023 if completed by April 15 and a second by December 31.
You might be thinking about contributing to a Roth IRA. One big hurdle to making these contributions is the fact that there are income limits that make high income individuals ineligible. For 2024, the phase out range for eligibility for Roth IRA contribution is between $230,000 - $240,000 for those who are married filing jointly and between $146,000 - $161,000 for single filers.
QUESTION:I know you can delay taking your first required minimum distribution (RMD) until April 1 of the year after you turn age 73. If you convert your entire IRA into a Roth before that date, but after you turn age 73, do you still have to take your first RMD distribution? Or is no distribution required as the entire IRA is converted prior to April 1 of the following year?
Three times a week, every week, we add to the Slott Report. Two article entries and a mailbag. All factual, measurable information. “This is what to consider when you name a trust as your beneficiary.” “How much can a sole proprietor contribute to a SEP account?” “This is how you fix an excess IRA contribution.” On and on it goes. All excellent, helpful material.
Retirement plan funds are designed for retirement, but Congress continues to make it easier for employees to pull out those funds while still working. The SECURE 2.0 law adds several new in-service withdrawals that can be made from 401(k), 403(b) and 457 plans.
Question:I have a client who is under age 59 ½ with a small traditional IRA. She wants to cash it in and use the funds for college education for her daughter. If I remember correctly, they can use this without a 10% penalty.
IRAs are an important, but often overlooked, part of your overall tax planning. As the deadline for filing 2023 tax returns approaches, it is a good time to incorporate your IRA plan strategies with your overall tax plan.
By Andy Ives, CFP®, AIF®IRA AnalystFollow Us on X: @theslottreport The same conversation has, understandably, been repeated many times. The questions are...
By Ian Berger, JDIRA AnalystFollow Us on X: @theslottreport Question: Hi Ed, I have Coverdell ESA accounts for my 5 grandchildren. My...
