How will the SECURE Act changes affect me?

February 10, 2020

Estate Planning

The SECURE Act became law in December 2019

The SECURE (Setting Every Community Up for Retirement Enhancement) Act makes major changes to IRAs and retirement plans. The Act is intended to strengthen retirement security and offers small employers tax incentives and the ability to band together to encourage them to offer their employees retirement plans such as a 401k. Also included in the Act is an increase in the required minimum distribution age and elimination of the stretch IRA for non-spousal account inheritors.


Before the SECURE Act made changes, qualified account holders had to begin withdrawing required minimum distributions (RMD) in the year they turned 70.5. The Act increased the minimum age to 72. This increase has tax implications that may benefit certain individuals. The Act also eliminates the maximum age for traditional IRA contributions, which was previously capped at 70.5.

Elimination of the Stretch

Before the SECURE Act made changes and became law many beneficiaries of inherited qualified plans were able to withdraw RMDs over the span of their lives. This was commonly referred to as a “stretch” and allowed qualified plans to continue to accumulate tax deferred earnings potentially for decades after the death of the original account owner. The SECURE Act eliminates the stretch for most non-spouse beneficiaries and replaces it with a requirement that all assets from an inherited qualified account be withdrawn within 10 years. There are no RMDs, and the only requirement is that the entire account must be distributed within 10 years.

If your estate plan was designed to accommodate a stretch to lessen the tax burden on your beneficiaries, now is the time to review how your plan is impacted by the SECURE Act. The estate planning attorneys at Helms Law Group, PA will work with you and your financial advisor to make this an easy process for you. Our office has attorneys licensed in North Carolina and South Carolina who can help you with all your estate planning needs. Call us today, at (704) 289-4577, or visit our website for more information and submit your information in the contact form.

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