Don’t forget to turn your clocks back this weekend!With that reminder comes another: pay attention to the Roth IRA distribution clocks. The key point to remember is that there are two different clocks, each used for a different purpose.
The year 2024 has flown by and the holidays season will soon be upon us. That means time is running out on year-end IRA deadlines. You will want to be sure to get the following three IRA-related tasks done sooner rather than later to avoid penalties and missed opportunities:
October 15, 2024 has come and gone. This was the deadline for correcting 2023 excess IRA contributions without penalty. If you missed this opportunity, you may be wondering what your next steps should be. All is not lost! While you may not have avoided the excess contribution penalty for this year, you can still correct the issue for future years.
When a traditional IRA owner wants to convert all or a portion of his account to a Roth IRA, he needs to think long and hard about the transaction. For example, some questions to consider:
In my August 19 Slott Report (“Year of Death RMD – Deadline Extended!”), I wrote about the required beginning date, who takes the year-of-death required minimum distribution (RMD), and the deadline for taking that distribution. Today’s article focuses on an additional nuance of the year-of-death RMD – something created by the final regulations (released July 18, 2024) - that could make taking the year-of-death RMD a little clunky in some situations.
QUESTION:I have been getting emails from a few sites pitching their subscriptions. They claim that Roth IRAs will all be taxable in the future. They say there are things you can do to avoid these taxes, but to find out what they are you have to subscribe to their newsletter. Is this true, and if so, how can one avoid taxes for Roth IRAs?
In 2020, the SECURE Act completely changed the game for nonspouse IRA beneficiaries. Now, most are subject to the 10-year payout rule. Recently released final RMD rules keep the controversial proposed rule that requires many beneficiaries subject to the 10-year rule to also take annual required minimum distributions (RMDs) during the 10-year period.
Of all the many provisions in the SECURE 2.0 Act, none has been more perplexing than Section 327, which changed the rules for spouse beneficiaries. It has been hard to figure out what Congress intended in drafting section 327. The legislative history is scant.
Question:Thank you for all of the wonderful information. I have a question as to how the July 18, 2024 final regulations impact inherited Roth IRAs. My daughters inherited Roths from their grandmother 3 years ago. She was age 101.
Question:Can a Roth IRA be rolled into a Roth 401k?Answer:While a Roth 401(k) can be rolled into a Roth IRA, the reverse is not true. You cannot roll a Roth IRA into a Roth 401(k). The only place where funds from a Roth IRA can be rolled over to is another Roth IRA.
