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Tom Meaglia, ChFC®, AEP®,

CLU®, CRPC®, MSFS

Chartered Financial Consultant

Investment Advisor Representative

Chartered Retirement Planning Counselor

CA Insurance Lic. #0567507

 

Meaglia Financial Consulting

2105 Foothill Blvd., #B140, La Verne, CA 91750

 

Toll Free: 800-386-3700

Bus:         909-593-6105

Cell:         818-681-8600

Fax:         909-593-6120

 

Email: tom@meagliafinancialconsulting.com

Website: www.meagliafinancialconsulting.com

November/December 2023

SECURE 2.0 Act Could Impact Your Plans

New Rules on paper with a business objects.

The SECURE Act and SECURE 2.0 Act made several changes that could affect your retirement and estate planning. Understanding what they could mean for your plans and discussing your options with your tax and financial professionals should be a priority. This article summarizes some of the Act's provisions.


Raising the Withdrawal Age
SECURE 2.0 Act raised the age at which you must take required minimum distributions (RMDs) from qualified retirement accounts, such as a 401(k) or other tax-deferred plans. Retirees can wait until April 1 of the year after the year in which they turn 73 to begin taking withdrawals, potentially allowing another year for their account balance to grow. In 2033, the age for taking RMDs will increase to 75. In addition, the tax for missing a required withdrawal has been significantly reduced.

A 10-year Time Limit
The Act imposes a 10-year limit on distributions from inherited IRAs. Previously, IRA beneficiaries could take RMDs throughout their lifetimes and leave the IRA principal to the next generation. Now, recipients of an inherited IRA must deplete the account within ten years. This rule curtails the ability to transfer wealth from one generation to the next. Spouses, dependent children, and disabled or chronically ill beneficiaries are not affected by the 10-year limit.


New Use for Unused Funds
You can convert funds in 529 savings plans* not used for education expenses to a Roth IRA for the account beneficiary. A child or grandchild who does not need all the money in the account to pay for education can now get a head start on retirement savings.

A Searchable Database
The Act requires the creation of a “lost-and-found” database where families can search for qualified retirement accounts that may have been forgotten by the deceased. Lost funds generally default to the state. The purpose of the database is to help beneficiaries claim the funds.

Get Professional Help
Changes brought about by the SECURE Acts may impact your situation. Getting your legal, tax, and financial professionals involved in reviewing your current plans can help determine whether you need to make changes.


* Certain restrictions apply. For example, the 529 savings plan must have been open for more than 15 years and the maximum that the beneficiary may rollover during their lifetime is $35,000. Speak with your financial and tax advisors for additional information.


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Thomas Meaglia is an Investment Adviser Representative of Coppell Advisory Solutions LLC, dba, Fusion Capital Management, a registered investment adviser that only conducts business in jurisdictions where it is properly registered, or is excluded or exempted from registration requirements. Registration as an investment adviser is not an endorsement of the firm by securities regulators and does not mean the adviser has achieved a specific level of skill or ability. The firm is not engaged in the practice of law or accounting.
Insurance and annuity products are not sold through Fusion Capital Management. Fusion does not endorse any annuity or insurance product, nor does it guarantee any insurance or annuity performance. Annuity and life insurance guarantees are subject to the claims-paying ability of the issuing insurance company. If you withdraw money from or surrender your contract within a certain time after investing, the insurance company may assess a surrender charge. Withdrawals may be subject to tax penalties and income taxes. Persons selling annuities and other insurance products receive compensation for these transactions. These commissions are separate and distinct from Fusion's investment advisory fees.
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