This post was authored by Salvatore M. Capizzi, Dunham's Chief Sales & Marketing Officer. If you have questions concerning today's topic, please call us at (858) 964 - 0500. Hold us to higher standards.

In 2019 the U.S. Senate had the Retirement Enhancement and Savings Act 2019 (RESA) on the heels of the Setting Every Community Up for Retirement Enhancement Act (SECURE), but RESA never made it to the floor.

On October 27, 2020, the Ways and Means Committee introduced the Securing a Strong Retirement Act of 2020 that never made it to the floor.

On Tuesday, January 19, 2021, House Ways and Means Committee Chairman Richard Neal sent an email to ThinkAdvisor saying, “I plan to reintroduce the Securing a Strong Retirement Act this Congress and expect it will pass with broad bipartisan support, just as the SECURE Act did in 2019.”

One of the key components of Securing a Strong Retirement Act was moving the age for Required Minimum Distributions (RMD) from age 72 to age 75.

As I wrote in a previous blog, RESA called for the same age (75) for RMDs and planned on paying for it by moving the tax due on designated beneficiaries from the end of the 10 year under the SECURE Act to 5 years under RESA.

Last year’s proposed Securing a Strong Retirement Act of 2020 also called for moving the RMD to age 75 but did not have a provision for a new 5 year rule for designated beneficiaries. Since the bill never made it to the floor, it is unknown if the intention was to add the 5 year provision.

We will keep our eyes on the developments in this area they will have a major impact on your current retirement clients and to the heirs they designate as beneficiaries. To read the past blog on Securing a Strong Retirement Act of 2020 click here.

To learn how Dunham Trust Company can help your clients eliminate the SECURE Act tax at the end of the 10th year, click here.

Disclosure:

This document is provided for informational purposes only by Dunham & Associates Investment Counsel, Inc. solely in its capacity as a Registered Investment Adviser and should not be construed as legal and/or tax advice. Dunham & Associates Investment Counsel, Inc. does not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.

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