Although the SECURE ACT is often discussed as one of the largest retirement-focused legislative reform in decades, it included a number of implications for individuals who are divorced or facing a divorce when it became effective January 1, 2020. While the law isn’t directed specifically to divorcing spouses, it’s important to understand these changes given that retirement accounts are a significant consideration in most divorce matters. Some of the SECURE Act provisions that will most likely impact divorcing spouses include:
Stretch IRA for Non-Spouse Heirs
Perhaps one of the most significant aspects of the SECURE Act impacting divorcing or divorced individuals is the elimination of the so called “Stretch IRA.” Under the old rules, beneficiaries were able to stretch required minimum distributions (RMDs) over their lifetime on inherited Traditional IRAs, Roth IRAs and qualified retirement plans. Under the new rules (with a few exceptions) non-spouse beneficiaries who inherit one of these accounts in 2020 or later are now required to withdraw all assets from the inherited account within 10 years following...
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