Articles — Ascensus

Removing and Recharacterizing Excess IRA Contributions

The deadline to remove excess contributions and avoid the penalty—removed with the net income attributable (NIA)—is the IRA owner’s tax return due date, plus extensions.

IRA, expertAscensusJuly 18, 2024IRA, Recharacterization, Excess Contribution, Traditional IRA, Roth IRA

How to Report Late IRA/HSA Contributions in Federally Declared Disaster Areas

You may have noticed an increase in clients making late IRA transactions because they live or work in a federally declared disaster zone. This disaster relief can affect your financial organization and how you report certain IRA transactions.

IRA, HSAAscensusJune 20, 2024IRA, Disaster, Distribution, IRS, Business Insights

DOL Releases Final Investment Advice Fiduciary Rule

The Department of Labor (DOL) recently released a regulatory package that includes a final amendment (the Retirement Security Rule) to the regulations that define what constitutes an investment advice fiduciary under the Employee Retirement Income Security Act of 1974 (ERISA) Title I and Title II (codified in the Internal Revenue Code).

Untangling Those Tricky IRA Withholding Rules

Financial organizations must offer federal withholding on all IRA distributions that may be subject to income tax.

expert, IRAAscensusJune 20, 2024Withholding, Beneficiary, Distribution, IRA, IRS

IRS Reminds Businesses of SECURE 2.0 Impacts on Form W-2

The Internal Revenue Service is reminding businesses who sponsor a retirement plan that certain provisions of SECURE 2.0 that became effective in 2023 may impact their Form W-2 reporting requirements.

Are You in Your 70s? The What, Who, and How of Delaying RMDs

Every year, retirement savers in their 70s are faced with either starting or delaying their required minimum distributions (RMDs): whether it be from an employer-sponsored retirement plan or an individual retirement arrangement (IRA). The required beginning date (RBD) determines how long an account owner can delay taking an RMD. As different RBDs may apply, the topic is notoriously confusing. But we are here to help.

Escheatment: When to Send IRA Assets to the State

The very nature of IRAs can make them more susceptible to becoming dormant. For example, because IRAs are meant to provide income during retirement, some individuals may keep their IRAs open for years with little to no activity. Other individuals may forget that they have an IRA or may not know that they have one (e.g., IRA beneficiaries or missing plan participants).

expert, IRAAscensusMay 16, 2024IRA, IRS, Roth IRA, Traditional IRA, Q&A

IRS Reminds Businesses of SECURE 2.0 Impacts on Form W-2

The IRS is reminding businesses who sponsor a retirement plan that certain provisions of SECURE 2.0 that became effective in 2023 may impact their Form W-2 reporting requirements.

IRS Releases FAQs on SECURE 2.0 Disaster Relief

The IRS has released a set of frequently asked questions (FAQs) regarding rules for distributions from retirement plans and IRAs under Section 331 of SECURE 2.0 for individuals affected by federally declared major disasters.

IRA, Employer Plan, News BriefAscensusMay 16, 2024IRA, IRS, Disaster, Distribution, Qualified Retirement Plan

IRS Provides Further RMD Transition Relief Under the SECURE Act

On April 16, 2024, the IRS issued Notice 2024-35 to provide additional transition relief for certain specified RMDs for 2024.

Reduce Form 5498 Reporting Errors with this Simple Step

As you’re preparing to send your Form 5498 files to your vendor for printing, you’ve probably caught some reporting errors as you audit the files. But mistakes happen. And those errors that inevitably slip through are likely those that keep you up at night. It’s not fun getting a phone call or visits from upset clients after they received an incorrect Form 5498.

IRAAscensusApril 18, 2024IRA, Business Insights, Reporting, Regulations, Traditional IRA, Roth IRA, Form 5498

529 Plan-to-Roth IRA Rollovers

The SECURE Act of 2022—also known as SECURE 2.0—made many changes to tax-advantaged savings arrangements. Not all SECURE 2.0 provisions took effect immediately. One new provision that takes effect in 2024 is the option for certain assets in 529 higher education savings plans to be rolled over to Roth IRAs.

expert, IRAAscensusApril 18, 2024Roth IRA, IRS, Contributions, IRA

SECURE 2.0 Act Adds New Penalty Tax Exception for Terminal Illness

One new penalty tax exception is for the terminal illness of a retirement plan participant or IRA owner. The provision applies to terminally ill distributions made after December 29, 2022. The rationale for this new exception is the potential need of an individual to use retirement funds for expenses related to a terminal illness.

Ascensus 800 Consulting Extended Hours

To assist Ascensus clients during the busy contribution and tax season, the 800 Consulting telephone lines will be open for extended hours.

Don’t Get Tripped Up by Tricky IRA Deadlines

There 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.

expert, IRAAscensusMarch 21, 2024Compliance & Operations, Beneficiary, IRA, Traditional IRA, Distribution

SECURE 2.0 Expands Roth Options for SEP and SIMPLE Plans

Before SECURE 2.0’s enactment, SEP and SIMPLE IRA plan contributions had to be made as pre-tax contributions, but now employers may allow employees to elect to have contributions into a SEP or SIMPLE IRA made as Roth contributions.