2024 RMD Regulations Are Here: Is It Time to Amend Your IRA Documents?
If your financial organization offers IRAs, you’ve probably been keeping a close eye on all the statutory and regulatory changes brought about by the CARES Act, SECURE Act, and SECURE 2.0.
In July of last year the IRS finalized its 2022 proposed regulations on required minimum distributions (RMDs) and issued new 2024 proposed RMD regulations. These regulations provide guidance on IRA beneficiary distributions and the 10-year rule payout requirement that was introduced with the SECURE Act.
Now is the time to make sure your clients are in the loop.
While you’re not legally required to send out updated IRA documents for these new rules until December 31, 2026, or a later date prescribed by the Treasury Secretary, it can be a smart move for your organization. Here’s why it matters and what you should be thinking about.
The Rules Are Final. Your Clients Deserve Clarity.
The 2024 final RMD regulations clear up a lot of the confusion surrounding RMDs. For example, there are updated timelines for when RMDs must begin for IRA owners and beneficiaries, and there are new exceptions and clarifications that affect how and when distributions need to be taken.
If your clients are relying on old or incomplete information, they could end up taking the wrong distribution amount, or worse, miss a deadline and face penalties. That’s not just bad for them; it’s bad for business. Proactively giving clients the latest information helps build trust and shows you are looking out for their best interests.
Disclosure Statement Amendments: A Recommended Best Practice
The IRS hasn’t required financial organizations to send out updated disclosure statements that reflect the 2024 final RMD regulations, but doing so is a recommended best practice. When the 2022 proposed RMD regulations were released, many financial organizations held off on making changes to their IRA documents, waiting for the final word. Now that those regulations have been finalized, it’s time to act.
Ascensus has made it easy for our clients. We’ve been updating our forms with the new rules every step of the way. We now have an updated 2025 full disclosure statement that is ready for clients who use our IRA documents to amend their existing Traditional, Roth, and SIMPLE IRAs, including inherited Traditional and Roth IRAs as applicable.
This 2025 update includes changes that are effective in 2025 and include the following.
2024 Final RMD Regulations
Reflected changes made by the SECURE Act to the applicable RMD age and beneficiary distribution options.
Required IRA owners to satisfy their total RMD obligation for all of their IRAs—whether they use aggregation, or not—before rolling over an IRA distribution to another IRA or employer-sponsored plan.
2024 Proposed RMD Regulations
Corrected the applicable RMD age for individuals born in 1959.
Addressed certain provisions under the SECURE 2.0 provisions Act of 2022, including the ability for allowing a spouse beneficiaries to elect to be treated as the account owner for RMD purposes and requiring hypothetical RMDs for spouse beneficiaries.
The IRS does require IRAs to be established using up-to-date documents—or with an appropriate amendment to supplement an older document. But we consider doing so a best practice. We update our IRA forms regularly, and our most recent update was released in late December 2024. This update provides your new clients with IRA documents that reflect the current rules and regulations.
We also believe it’s a customer service best practice for our clients to amend their existing IRA disclosure statements at the same time they begin to use updated documents for establishing IRAs. Ascensus strongly recommends having your new and existing clients use the same document.
Let Us Help Amend Your Disclosure Statements
The IRS expects to issue revised model IRA documents. But how much longer should your clients wait? If your organization didn’t amend its IRA disclosure statements with Ascensus in 2023, then your IRA documents don’t reflect the current rules.
Ascensus makes it easy to amend your IRA documents. Our amendment mailing service can do all the work for you. We’ll send out the entire IRA disclosure statement amendment packet, along with a cover letter, to your clients. The documents include key specifications for the amendments. To learn more about these IRA amendments and amendment options, visit our IRA Document Amendment Solutions webpage here or contact your sales representative. We also have options for non-Ascensus clients. Call us at 800-346-3860, menu option 2, suboption 1, so we can talk through the options with you.
Let Ascensus help ensure your clients are informed, protected, and confident in their retirement strategy.
