Within the last 12 months, we have essentially seen the passage of three major pieces of federal legislation that impact retirement planning. Far and away the biggest retirement planning bill of the three was the SECURE Act, passed at the end of 2019, and mostly going into effect in 2020. However, due to COVID-19 and the ensuing CARES Act, the SECURE Act likely hasn’t gotten the attention it needs.
The SECURE Act dramatically changed the rules about when inherited retirement accounts need to be distributed and moved the beginning date for RMDs to age 72, up from 70.5. The CARES Act, designed to provide relief during the pandemic, waived most RMDs for 2020, created the coronavirus-related distribution for 2020, and expanded 401(k) loan options for those impacted by the pandemic.