Tax Wealth & Estate Planning / 10.30.2020

Proposed Retirement Bill Would Benefit Seniors & Student Loan Borrowers

By Kevin O’Connor

retirement billThe Chairman and Ranking Member of the House Ways and Means Committee introduced this week the “Securing a Strong Retirement Act of 2020.” The bi-partisan bill provides a number of changes to the country’s current retirement system. These include:

  • Raising the age at which seniors must begin taking Required Minimum Distribution (RMD) by withdrawing funds from 401(k) and IRA accounts from 72 to 75, thus allowing seniors more time to accumulate retirement assets
  • Eliminating the RMD requirement for 401(k) and IRA accounts with balances of less than $100,000
  • Allowing businesses to pay a 401(k) match for workers paying off student loans, permitting younger workers to provide for their retirement while carrying student debt
  • Increasing from $100,000 to $130,000 the limit on “Qualified Charitable Distributions” from qualified retirement plans to count toward a retiree’s RMD
  • Increasing the catch up contribution permitted taxpayers over 60 years old to $10,000 which will be indexed for inflation

While bi-partisan in its provisions, the prospects for this bill are subject to the vagaries of the upcoming lame duck session of the Congress. It contains several other retirement account improvements as well. Should you have questions or desire more information, please feel free to reach out to Kevin O’Connor (kto@kjk.com; 216.736.7213) or Demetrius Robinson (djr@kjk.com; 614.427.5749).

 

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