Financial organizations are not required to send notices to clients or report to the IRS when an annual payment must be taken from an inherited IRA. The beneficiary is responsible for knowing and taking any required life expectancy payments.
Although not required, many financial organizations assist their clients with this calculation.
Read MoreThe SECURE 2.0 Act has brought significant changes to retirement planning—especially for retirees aged 72 and older. One of the most significant updates is the delay for retirees to take required minimum distributions (RMDs), which now begin at age 73 (age 75 in 2033). While this offers flexibility, it also introduces new challenges that retirees should understand.
Read MoreWhen clients bring inherited IRAs from other financial organizations to yours, your team must know which information to collect in order to ensure a smooth transition.
Read MoreWhen an IRA owner dies, the assets are distributed to beneficiaries, whether named by the IRA owner or determined by IRA document defaults. This can sometimes be a complicated process for financial organizations. And further complications may arise when the original beneficiary dies, leaving the inherited IRA to a successor beneficiary.
Read MoreThe SECURE Act—officially known as the Setting Every Community Up for Retirement Enhancement Act of 2019—made significant changes to IRA and retirement plan rules, including to the beneficiary payout options. One of the most noteworthy changes involves the 10-year rule, which requires a total distribution of inherited assets by December 31 of the year containing the 10th anniversary of the account owner’s death.
Read MoreAlthough IRAs are meant to provide individuals with a source of income during retirement, many clients may want to incorporate their IRAs into their overall estate planning. In such cases, while making clear that you are not providing tax or legal advice, you may find yourself discussing IRA beneficiary options with clients. Beneficiary options—especially for Roth IRAs—can be confusing.
Read MoreIRS final required minimum distribution (RMD) regulations were published on July 19, 2024, more than four years after enactment of relevant statutory changes in the SECURE Act of 2019. Especially noteworthy are provisions affecting those who inherit an IRA whose owner had not yet satisfied the RMD for the year in which they died. Ironically, these provisions have the potential to both simplify and to complicate the process by which beneficiaries meet year-of-death RMD obligations.
Read MoreFinancial organizations are responsible for paying out HSA assets to beneficiaries after an HSA owner’s death and properly reporting these distributions to the IRS, so your role as an HSA administrator is important. And because HSA beneficiary options differ from IRA and employer plan beneficiary options, it’s a good idea to familiarize yourself with the options and distribution process.
Read MoreA plan administrator must take all necessary steps, as determined by the facts and circumstances of the participant’s situation, to determine if the participant is truly missing or nonresponsive.
Read MoreEvery year industry professionals gather with Ascensus trainers at the Ascend conference. Not only do they get to continue their education and refine their expertise in retirement, health, and education savings plans, but they get to submit questions to our highly-qualified trainers. Here are the top questions asked and answered over the week.
Read MoreThe new RMD regulations are not without at least one limitation for spouse beneficiaries, in the form of the “hypothetical RMD.” This could affect a spouse beneficiary who inherits an IRA or qualified retirement plan account before the deceased’s RMDs are required to begin—generally age 73—and who elects the new 10-year beneficiary payout rule in order to delay the onset of required distributions.
Read MoreFinancial organizations are responsible for paying out IRA assets to beneficiaries after an IRA owner’s death and properly report these distributions to the IRS. Ensuring that an IRA owner’s beneficiary designation is up-to-date and as complete as possible can minimize any distribution issues.
Read MoreFinancial organizations must offer federal withholding on all IRA distributions that may be subject to income tax.
Read MoreThere are many deadlines to keep track of throughout the year. Although it’s generally up to clients to track these deadlines, they may come to you for guidance. This article will cover some common questions surrounding certain IRA-related deadlines.
Read MoreBeginning with account owner deaths in 2020 and later, the SECURE Act of 2019 made significant changes to the rules on how qualified plan beneficiaries distribute their inherited assets. One significant provision prevents most nonspouse beneficiaries from “stretching” out distributions and taxation over their life expectancy.
Read MoreAre there any age restrictions to making an IRA contribution? Can a working spouse contribute to a retired spouse’s IRA? What are the IRA catch-up contribution rules? Can I contribute to a 401(k) plan and to a Traditional IRA? Here are answers to your common IRA contribution questions.
Read MoreWhat is a Sarbanes-Oxley blackout notice? What is a blackout period? What information must be included in the blackout notice? What are the potential consequences of not providing a timely blackout notice?
Read MoreJanuary is rapidly approaching and with it comes the deadline for fair market value (FMV) statements. One of the most challenging IRA reporting requirements is FMV statement reporting for the IRA owner’s year of death.
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