Monday, October 12, 2020
The Internal Revenue Service (IRS) issued Notice 2020-68 on September 2, 2020. The Notice provides "guidance in the form of questions and answers regarding several provisions in the Setting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act).
Below are the SECURE Act topics that Notice 2020-68 addresses:
The Act gives qualified employers that have established an eligible automatic contribution arrangement under an employment plan a business credit equal to $500 per year. Notice 2020-68 provides information on the limitations of this business credit.
IRA Contribution Age Limit
"The SECURE Act eliminated the prohibition on individual retirement account (IRA) contributions by individuals after they reach age 70½ that existed under prior law. Notice 2020-68 clarifies that financial institutions are not required to accept contributions after age 70½."
401(k) Participation Part-Time Employees
New amendments have been added to the Act regarding 401(k) participation, which the Notice acknowledges and explains.
Qualified Birth or Adoption Distributions
Difficulty of Care Payments
This is just a brief summary of the information that Notice 2020-68 provides. A thorough reading of the SECURE Act and Notice 2020-68 is necessary for attorneys advising clients about retirement planning.
See Current Developments in Estate Planning and Business Law: October Review, Wealth Counsel, October 9, 2020.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.