Question:I have a large amount of stock from a previous employer in my 401(k). I had been reinvesting the dividends for the last 23 years since I left the company. I no longer want to reinvest the dividend to buy additional shares. Most of the stock has appreciated considerably since I bought it.
The year 2023 has arrived. It is a new year, and we have new rules for retirement accounts thanks to SECURE 2.0 which Congress passed in the waning days of last year. SECURE 2.0 is a giant piece of legislation, clocking in at over 300 pages, and some of its provisions will not be effective for years to come. Here are some of our top takeaways from the SECURE 2.0 provisions that are effective right away.
The Internal Revenue Code is over 4,000 pages of often unintelligible tax jargon. So, it shouldn’t surprise anyone that the law contains more than its share of baffling and inconsistent provisions.Here are four examples pertaining to IRAs and company retirement plans:
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.
On August 30, 2016 IRS released Announcement 2016-30 that allows for streamlining employer plan loan procedures and liberalizing hardship distribution rules for most employer plans. The following procedures are in effect until January 17, 2017 for victims of the storms and flooding in Louisiana that began on August 11, 2016.
As with most IRA/tax strategies, the net unrealized appreciation (NUA) strategy comes with a few “don’ts.” Any one of these could mean a loss of your ability to take advantage of the NUA tax benefit.
When you leave an employer, you have an important decision to make. If you participated in a company plan, you need to decide what to do with your money. Should you roll over your funds to an IRA? Here are 3 exceptions to the early distribution penalty that just apply to IRAs.
There are two things to keep in mind when you are discussing ages and retirement plans. One is the age itself and the other is what does that age mean. For example, when is age 55 not 55? You will understand as you read further into the important ages associated with retirement plans.
With the calendar well into May, wedding season has arrived in full force. You have probably heard the saying that marriage has its benefits. Well, this is especially true when it comes to the IRA rules. If you are married, you may have some IRA options that would not have been available to you if you had not taken the plunge and tied the knot. Here are 4 IRA benefits you may have if you are married.
