Stretch IRA'S

Mr. Tom Gucciardi, Founder of Global Financial Group explains the most current IRA or any Qualified account you own. Such as a 401 K. Please call 954-804-4381 with questions.

ln December 2019, the federal SECURE Act was signed into law which amended several provisions regarding individual retirement accounts. The SECURE Act made the following changes:

  • lncreased Required Beginning Date: The SECURE Act increased the age triggering the required beginning date for IRA required minimum distributions (RMDs) to 72. This change applies to distributions required to be made after December 31., 2019, with respect to individuals who attain age 70 1/2 after that date.
  • "Stretch" RMD: Upon the death of an IRA owner, the individual beneficiary is required to draw down his or her entire inherited interest within 10 years. This rule applies regardless of whether RMD had begun before the owner's death. This change applies generally with respect to deaths after 2019.
  • EDB Exception: The above lo-year rule does not apply to any portion payable to an "eligible designated beneficiary" (EDB) if (1) that portion will be distributed over the beneficiary's life or a period not exceeding his or her life expectancy and (2) those distributions begin within one year of the death. An EDB means a designated beneficiary who is:
  • o The surviving spouse
    o A child under the age of majority
    o Disabled or chronically ill
    o Any other person who is not more than 10 years younger than the IRA owner.

  • The new law does not change the ability of a deceased IRA owner's spouse to treat the IRA as their own, but the new rules will apply upon the surviving spouse's death.
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