https://retirementplanningscottsdale.com/2019/12/26/anil-vazirani-scottsdale-investment-advisor-shares-inheriting-iras-just-got-complicated-thanks-to-a-new-retirement-overhaul/ Anil Vazirani Scottsdale Investment Advisor shares an article from The Wall Street Journal “Inheriting IRAs just got complicated due to a new retirement overhaul.”
The government’s latest year-end spending package includes provisions that would require IRA beneficiaries to withdraw their inherited assets within 10 years. The change would affect seniors who converted traditional IRAs to Roth accounts and paid taxes for the benefit of their heirs. IRA expert Ed Slott said: “People made long-term plans believing they could rely on the tax laws at the time. This revision changes the rules in the ninth inning of the game and causes savers to lose faith in long-term tax planning.”
The biggest 401(k) mistake
“Liquidating old 401(k) assets can be a poor decision for employees who switch jobs, as it will trigger income taxes on top of a 10% early withdrawal penalty,” an expert in Kiplinger writes. “Instead workers are advised to consider rolling over the funds to an IRA, move the money to their new 401(k) plan, or leave the assets with their employer’s old 401(k) plan, just consider this choice before you act.”
What is the best retirement strategy?
Using a combination of strategies to secure your post-career life, according to an article in Motley Fool. That’s because an effective retirement approach is built to address a number of factors, including health care costs, living expenses, life expectancy and investments. Also, you’ll need to use the right retirement accounts, according to the article. For example, contributing to a traditional 401(k) and a traditional IRA can help reduce taxable income, while a Roth 401(k) or a Roth IRA offers no upfront tax deduction on the contributions, but distributions will be tax-free in retirement.
For more information: https://www.financial-planning.com/news/inheriting-irsa-just-got-complicated-thanks-to-a-new-retirement-overhaul
Anil Vazirani is president of Secured Financial Solutions, independent insurance advisor investment advisor rep with a fiduciary obligation and in the financial services industry since 1994. A+ rating with the Better Business Bureau for over a decade and a half, members in good standing with the National Association of Insurance and Financial Advisors.
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