The past few years have been a roller coaster ride for many retirement savers. After performing well for several years, the broader investment markets have been hit hard since the beginning of 2022. Now the price of gas, food, housing, and other goods and services continue to rise, and for many of us, something needs to give.
But that “something” shouldn’t be your retirement savings.
Read MoreEarly IRA distributions—or distributions taken before age 59½—are generally subject to a 10 percent early distribution penalty tax. But there are several exceptions to this age 59½ rule, including an IRA owner’s qualifying disability.
Read MoreA 401(k) is one of the most common qualified retirement plans offered by employers to help their employees save for their retirement. While many employees take advantage of this important benefit, many may not understand that they have a choice in the type of contribution they make—and the mechanics of how their contribution is taxed.
Read MoreYour clients should understand that they must earn enough eligible compensation for the tax year to support their IRA contributions. But what is considered “eligible compensation?”
Read MoreIRA owners sometimes contribute more than they are permitted. Or they may contribute only to later discover that they cannot deduct the contribution. And sometimes they simply want to take the contribution out for some other reason. Whatever the situation, IRA owners—and financial organizations—must follow detailed rules for excess removals.
Read MoreMany plan sponsors believe that the availability of loans in retirement plans is an attractive feature. Specifically, participants are more likely to contribute to a plan if they know that they can access a portion of their plan assets while they are still employed—without having to suffer the accompanying tax consequences.
Read MoreThe Davis-Bacon Act (DBA) has played a major role in the construction industry for over 90 years. Passed in 1931, it has been described by the Supreme Court as a “minimum wage law designed for the benefit of construction workers.” The DOL has issued proposed regulations that represent the most comprehensive changes to the DBA since 1982.
Read MoreWhen spouse beneficiaries come in to settle their inherited retirement accounts, you and your staff may want to share with them how the proposed RMD regulations could affect their financial decisions.
Read MoreIt has been 20 years since the IRS last made regulatory changes for required minimum distributions (RMDs). Today, we have proposed RMD regulations. But we also have many new questions that affect the plan administration of RMDs.
Read MoreThere are fundamental differences between correcting SEP and SIMPLE plan excesses, which are generally created by employer contributions, and correcting Traditional and Roth IRA excesses, which are created by the account owner.
Read MoreMany defined contribution qualified plans, such as 401(k) plans, allow employers to make a matching contribution. Providing a match may encourage employees to make elective deferral contributions to the plan. There are several guidelines that may affect when matching contributions should be made.
Read MoreIn the May 23, 2022, issue of Employee Plans News, the IRS explains the applicability of the Employee Plans Compliance Resolution System (EPCRS) for pre-approved plans that are not restated by appropriate deadlines.
Read MoreOver the next several months, we will be featuring stories in The Link newsletter on the pandemic’s impact on retirement readiness. This series is not for us to look behind us at what we may have lost; instead, it’s meant to help us look ahead. We want to support our business partners as we all navigate the continued impact of this pandemic. We want to continue to encourage and promote a healthy approach to retirement, health, and emergency savings for all ages, from the retiring Baby Boomer generation to the teenage Gen Z.
Read MoreIf your clients took CRDs in 2020, they still have time to make repayments to their qualified retirement plan or eligible IRA. Because a relatively small number of qualified individuals took CRDs in 2020 you may handle few CRD repayments, but their proper reporting is no less important for their infrequency.
Read MoreThe 2021 tax season is almost over. We say almost because most financial organizations still have one last report to file, IRS Form 5498, IRA Contribution Information, which must be filed with the IRS by May 31. Do you know what to do after the Form 5498s have been sent to the IRS and to IRA owners and errors are discovered on the form? We will walk you through the corrections process.
Read MoreEmployers of all types have expressed interest in learning more about multiple employer plans (MEPs). But the unified plan rule, sometimes known as the “one bad apple rule,” has discouraged some employers from pursuing MEP participation. This rule treats a qualification failure by one participating employer as a MEP disqualification event for all employers maintaining the plan. To help expand access to MEPs, the IRS has released proposed regulations, which provide a welcome exception to the unified plan rule. The proposed regulations also withdraw prior proposed regulations that were originally issued in July 2019.
Read MoreIndividuals may simultaneously convert Traditional IRA assets and roll over pretax 401(k) plan assets to a Roth IRA. The transactions are relatively straightforward from a compliance perspective. Neither are subject to income restrictions or the one-per-12-month rollover rule. Both types of transactions can be done directly, which eliminates concerns over the 60-day rule.
Read MoreSome exceptions apply universally across both qualified retirement plans (QRPs) and individual retirement accounts (IRAs). Some exceptions, however, are unique to QRPs and some are unique to IRAs.
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