Secure 2 0 Changes

SECURE 2.0 Act — Key Changes The SECURE 2.0 Act of 2022 (enacted December 29, 2022) made sweeping changes to retirement account rules. It builds on the original SECURE Act of 2019. EA candidates must know the specific ages, dates, and dollar amounts introduced by this law. --- ## RMD Age Increase Required Minimum Distributions (RMDs) must begin no later than the required beginning date (RBD). SECURE 2.0 increased the starting age in two steps: | When Born | RMD Begins | |---|---| | Before July 1, 1949 | Age 70½ (pre-SECURE Act) | | July 1, 1949 – December 31, 1950 | Age 72 (SECURE Act 1.0) | | January 1, 1951 – December 31, 1959 | Age 73 (SECURE 2.0) | | January 1, 1960 or later | Age 75 (SECURE 2.0, effective 2033) | Effective date for age 73: January 1, 2023 Effective date for age 75: January 1, 2033 RMDs are calculated annually based on the prior year-end account balance divided by the applicable life expectancy factor from IRS Uniform Lifetime Table. --- ## Reduced Penalty for Missed RMDs Old rule: 50% excise tax on the shortfall (amount not distributed when required). New rule under SECURE 2.0: - Reduced to 25% for missed RMDs - Further reduced to 10% if the missed RMD is corrected within the correction window (generally by the end of the second taxable year following the year of the missed RMD) This change applies to RMDs due for 2023 and later. --- ## Roth Employer Contributions Old rule: Employer contributions (matching, profit-sharing) had to go into pre-tax accounts. New rule: Employers may allow employees to elect that some or all employer…