SECURE Act 2.0 - Setting Every Community Up for Retirement Enhancement

Posted by Gayla K. AustinMar 04, 20240 Comments


The Setting Every Community Up for Retirement Enhancement ("SECURE") Act became Public Law 116-94 on December 20, 2019.  The SECURE Act of 2022 ("SECURE 2.0") became Public Law 117-328 on December 29, 2022.  

Here are some of the provisions: 

  1. After December 31, 2024 most new 401(k) and 403(b) (not government retirement) plans will have to automatically enroll employees; escalate contributions from at least three percent of each paycheck by 1% per year until reaching a minimum of 10% but not exceeding 15%.  (There are exceptions).
  2. Increased applicable ages resulting in later start dates for RMDs--the applicable age increased from 70 1/2 to 72--now 73.  (Based on a table and there are graduated start dates). 
  3. Increased limits on catch up contributions for persons 60 through 63 years.  
  4. Removal of the distinction in distribution rules for individuals and employment plan Roth IRAs. 
  5. Clarification of the statute of limitation and the penalties on excess contributions and failure to take RMDs. 
  6. Ability to convert some 529 plans to Roth IRAs. 
  7. Greater participation by sole proprietors, small businesses and part time workers. 
  8. Starter 401(k) Plans and Safe Harbor Plans. 
  9. Improving Coverage for Part Time Workers. 
  10. Easier withdrawals for hardships and the relaxation of the 10% penalty for withdrawals prior to the owner attaining 59 1/2 years. 
  11. Surviving spouse of a deceased employee to be treated as the employee for RMDs. 
  12. Ability for a charity to qualify as a remainder beneficiary of a special needs trust. 

This outline is provided for general discussion and is neither legal advice nor a complete treatment of each issue.  

If you would like to weave your retirement accounts into your estate plan, please contact me at 307.200.1914.