Congress clarifies Secure 2.0 RMD ages

[Alan S.]

There was a drafting error in the Secure 2.0 legislation regarding the increase in RMD age for plan owners, specifically for those born in 1959. Congress has advised the IRS by letter of their intent, to be followed by technical correction in a future bill.

The end result is that the RMD age for those born in 1959 will be 73, and for those born after 1959 the RMD age will be 75.

Summary of DOB RMD ages:
Prior to 7/1/1949 70.5
7/1/1949 to 12/31/1950 72
1951-1959 73
After 1959 75

[BespokeBiker]

Thanks for the update on this.

[Steady59]

'59 baby here. Does the RMD have to start in the year that you turn 73 or the year following?

[rkhusky]

'59 baby here. Does the RMD have to start in the year that you turn 73 or the year following?

The year you turn 73, although you can defer until April 1 of the following year, but then you will take two RMD’s that year.

[Steady59]

'59 baby here. Does the RMD have to start in the year that you turn 73 or the year following?

The year you turn 73, although you can defer until April 1 of the following year, but then you will take two RMD’s that year.

Thank you.

[WoodSpinner]

There was a drafting error in the Secure 2.0 legislation regarding the increase in RMD age for plan owners, specifically for those born in 1959. Congress has advised the IRS by letter of their intent, to be followed by technical correction in a future bill.

The end result is that the RMD age for those born in 1959 will be 73, and for those born after 1959 the RMD age will be 75.

Summary of DOB RMD ages:
Prior to 7/1/1949 70.5
7/1/1949 to 12/31/1950 72
1951-1959 73
After 1959 75

Thanks! I have been waiting for this announcement…..

[HomeStretch]

Alan, thanks for the update. Your posts regarding Secure Act 2.0 and RMDs/Inherited RMDs have been very helpful!

[Alan S.]

Here is a new article on the widely overlooked Secure 1.0 IRS proposed Regs which apply a deadline to spousal assumption of ownership on an inherited IRA.

https://www.morningstar.com/financial-a ... eneficiary

I suspect that a Morningstar subscription is required to open the above link. If so the following key paragraph is copied below:

New Deadline for Treating As Own

No longer can we tell spouse beneficiaries that they have forever and a day to elect the treat-as-own option for inherited IRAs. Instead, the proposed RMD regulations for Secure Act 1.0 explain that the deadline for a spouse beneficiary to treat an inherited IRA as their own is the later of:

The end of the calendar year in which the surviving spouse reaches their applicable RMD age, and
The end of the calendar year following the calendar year of the IRA owner’s death.
If a spouse beneficiary misses the deadline to treat an inherited IRA as their own, there is still hope, as they can roll over the amount instead. But any beneficiary RMD due must be taken before the rollover.

This deadline also exposes the surviving spouse to the one rollover rule if they must use a rollover because the deadline was missed. They may not even have a rollover available. Further, this would trigger beneficiary RMDs for the rollover year that in the past could have been reduced by treating the assumed IRA as owned the entire year and using the Uniform Table.