Matt Smith

The 10-Year Rule and Inherited IRAs: Today’s Slott Report Mailbag

Question: I have a general question regarding the 10-year time frame for emptying an inherited IRA. Your guidance says that the deadline is the END of the tenth year following death. In this specific situation, the death occurred July 9, 2020, so I believe the deadline is December 31, 2030, the end of the tenth year.

4 Ways to Reduce Your RMD Tax Bite

Markets continue to climb. That is good news for your retirement account. However, there is a downside. When you contribute to a traditional IRA or a pre-tax 401(k), you make a deal with Uncle Sam.

10 Points: Fixing Excess IRA Contributions

‘Tis the season for identifying and correcting excess IRA contributions. It seems as if every other recent inquiry is about this subject. To keep readers on the straight and narrow, here are ten details about excess IRA contributions and the correction process…

RMD Rules for IRA Beneficiaries: Today’s Slott Report Mailbag

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?

Are 529-to-Roth IRA Rollovers Subject to State Tax?

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.

Two Cautions When Doing a Backdoor Roth Conversion

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.

Required Minimum Distributions and Eligible Designated Beneficiaries: Today’s Slott Report Mailbag

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?

What is Retirement? Fantasy vs. Reality

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.

How SECURE 2.0 Impacts Company Plan In-Service Withdrawals

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.