By Sarah Brenner, JD Director of Retirement Education Question: Dear Sirs: I inherited a regular IRA upon my mother's death in 2015. I am now 75 years old and have been taking required distributions since then. She was taking distributions herself when she died. My...

By Ian Berger, JD Director of Retirement Education Should I Accept a Lump Sum Buyout Offer? With economic uncertainty increasing, more companies with defined benefit (DB) pension plans will likely attempt to improve their bottom line by offering lump sum buyouts. A...

By Ian Berger, JD IRA Analyst Question: I am 66 and would like to convert one of my IRAs to a Roth, but I am not sure if any of my old IRA accounts have any after-tax contributions. I have no records, so I assume they are all pre-tax but I am not sure. If I convert...

By Andy Ives, CFP®, AIF® IRA Analyst Over the past couple of months I have been tasked with the unfortunate responsibility of helping my mother sort through her financial affairs after the death of her spouse. My dad passed in March, and it has been a steady stream of...

By Sarah Brenner Director of Retirement Education You may have heard how converting to a Roth IRA is a great move for younger people. This is no surprise. A younger person who converts has two big factors working in her favor. She may pay taxes on a smaller IRA...

By Andy Ives, CFP®, AIF® IRA Analyst Question: Hi Ed, I’m 66 Years old. Less than a year ago I converted into my Roth from my traditional IRA with the intention of parking it there until I could finalize the details of a summer house purchase. I know I have taxes to...

By Andy Ives, CFP®, AIF® IRA Analyst The 72(t) rules (”series of substantially equal periodic payments”) allow a person to tap retirement dollars before 59½ without a 10% early distribution penalty. However, to gain this early access, you must commit to a plan of...

By Sarah Brenner Director of Retirement Education Question: Ed, My mother passed away in May 2019, and I inherited her IRA.  She had not completed her RMD for 2019, so I did that. In 2020, I began my RMDs based on the Single Life Table for Inherited IRAs. Since I...

By Sarah Brenner Director of Retirement Education If you inherit an IRA, especially if it is a larger one, you may be afraid of being stuck with the five-year distribution rule. If this rule applies, your IRA must be entirely emptied in five years, which can be a...

By Ian Berger, JD IRA Analyst Those of you who participate in 401(k) plans or certain 403(b) plans should see something new on your next quarterly statement for the period ending June 30, 2022. For the first time, the statements must include illustrations of the...

By Ian Berger, JD IRA Analyst Question: Good Day, I have a client (age 65) who inherited a traditional IRA from her mother in 2020. I know that she must empty the account by 12/31/30. She is not an eligible designated beneficiary (EDB). I’m trying to calculate the...

By Andy Ives, CFP®, AIF® IRA Analyst SCENARIO: John owns multiple Roth IRAs. He believes it is necessary to maintain all these accounts to keep things properly organized and to track his 5-year conversion clocks. He has contributed to Roth IRA #1 for over a decade. He...

By Sarah Brenner, JD Director of Retirement Education You can have too much of a good thing. While saving for retirement with an IRA is a good strategy, there are limits.  When a contribution is not permitted in an IRA, it is an excess contribution and needs to be...

By Andy Ives, CFP®, AIF® IRA Analyst Question: As we did 2 years ago, will we be able to skip taking a 2022 required minimum distribution (RMD) without penalties? Answer: Sorry, but RMDs are in full effect for 2022. The CARES Act waived RMDs in 2020, but that was a...

By Ian Berger, JD IRA Analyst Usually, rollovers involving 401(k) accounts and IRAs involve moving dollars from a plan to an IRA. But sometimes it makes sense to instead do a “reverse rollover” – from an IRA to a 401(k). Let’s get some bad news out of the way:...

By Sarah Brenner, JD Director of Retirement Education Question: I am 79 and make SEP-IRA withdrawals annually as required. I also have several regular (non-IRA) accounts. One fund I own throws off tremendous taxable capital gains every year. Is there any way I can...

By Sarah Brenner, JD Director of Retirement Education Why is it so important to know how the once-per-year rollover rule works? Well, that is because trouble with the once-per year rule is the kind of trouble no one wants! An IRA owner who violates this rule is...

By Ian Berger, JD IRA Analyst Question: Hi, I am age 50 and am targeting retirement at age 55. My current employer is selling the division I work for, and I see the potential that I could be laid off at, say, 52. If this were to happen, could I join a new employer...

By Ian Berger, JD IRA Analyst Employees leaving their jobs are often surprised to discover they aren’t entitled to the full balance of their company plan account. The reason is that some plans impose a vesting rule on certain types of contributions. What do the...

By Andy Ives, CFP®, AIF® IRA Analyst Last week in Kansas City, the Ed Slott team hosted our first in-person training program for members of our Elite Advisor Group since late 2019. While we managed to stay in contact with everyone via virtual meetings for the last two...

By Andy Ives, CFP®, AIF® IRA Analyst Question: I have a 401(k) that I'd like to use a portion for a QCD. I understand that QCD's have to be from an IRA. Can I move a portion to an IRA for the QCD? How will this affect my RMD from my 401(k)? Federal tax implications?...

By Sarah Brenner, JD Director of Retirement Education The real estate market is red hot right now. This can be especially challenging for first time home buyers. IRA savings are intended to be used for your retirement. However, if you are like many others, your IRA...

By Ian Berger, JD IRA Analyst Just when we thought we understood the new IRS regulations on required minimum distributions (RMDs), here comes more uncertainty. As we have reported, the IRS threw everyone a curveball with its interpretation of the 10-year payout rule...

By Sarah Brenner, JD Director of Retirement Education Question: I am 75 years old and contributing to my company’s 401(K) plan. I have not taken an RMD from my 401(K) utilizing the “still-working exception.” I just retired on April 30, 2022. My question is: Do I have...

By Andy Ives, CFP®, AIF® IRA Analyst Qualified charitable distributions (QCDs) continue to gain popularity, and with that popularity comes more questions. Here are a dozen QCD facts that will keep you on the straight-and-narrow with your QCD transactions: 1. QCDs are...

By Sarah Brenner, JD Director of Retirement Education Recently, Fidelity investments made headlines by announcing that it would allow retirement savers to put Bitcoin in their 401(k)s. Cryptocurrency has been all over the news, and you may be wondering if it would be...

By Andy Ives, CFP®, AIF® IRA Analyst Question: I’m 68 years old. I would like to start IRA withdrawals. What are the rules for withdrawing before my RMDs are required at age 72? Thanks, Bob Answer: Bob, There are no limitations to withdrawing your IRA before RMDs...

By Ian Berger, JD IRA Analyst There are three types of company savings plans: 401(k) plans if you work for a for-profit company; 403(b) plans if you work for a tax-exempt employer, a public school or a church; and 457(b) plans if you work for a state or local...

By Andy Ives, CFP®, AIF® IRA Analyst For those who have 401(k)s or other employee retirement plans (but not SEP or SIMPLE plans), the required beginning date (RBD) for when required minimum distributions (RMDs) are to begin is the same as for IRA owners – April 1 of...

By Ian Berger, JD IRA Analyst Question: Hello, I’m learning a lot from Ed Slott’s latest book, “The New Retirement Savings Time Bomb,” but I do have a question on 401(k) Roth IRA conversions. I’m recently retired with a company 401(k). I’m leaning towards keeping the...

By Sarah Brenner, JD Director of Retirement Education For IRA-to-IRA or Roth-to-Roth 60-day rollovers, the same property received is the property that must be rolled over. These rules also apply to SIMPLE and SEP IRAs. You cannot receive a distribution of cash and...

By Ian Berger, JD IRA Analyst Tax Day 2022 seems like an appropriate time to review a sometimes-overlooked way to get extra dollars into your IRA or company savings plan. Folks age 50 or older are allowed to make “catch-up” contributions with no strings attached....

By Sarah Brenner, JD Director of Retirement Education Question: Hello, Client (72) has recently inherited a “Beneficiary IRA” account. My question is for next year:  Can she use qualified charitable distributions for her beneficiary IRA? Thank you, Kathy Answer: Hi...

By Andy Ives, CFP®, AIF® IRA Analyst The deadline for filing your 2021 tax return is this Monday, April 18. It is extended through the weekend because IRS offices in Washington DC are closed on Friday, April 15, in observance of the locally recognized Emancipation...

By Sarah Brenner, JD Director of Retirement Education The SECURE Act was signed into law in late December of 2019. This new law upended the rules for retirement accounts. With it came many questions, and IRS guidance was eagerly anticipated. Finally, on February 23,...

By Andy Ives, CFP®, AIF® IRA Analyst Question: I have a non-spousal inherited IRA account.  Once I take out my RMD for the year, am I able to take out excess funds and roll those into a Roth account? Thank you. Answer: Inherited IRA accounts do not follow all the same...

By Ian Berger, JD IRA Analyst A bill designed to increase savings in IRAs and company plans has passed the House of Representatives, but it’s not yet law. The bill is officially called the “Securing a Strong Retirement Act of 2022,” but many are calling it “SECURE...

By Andy Ives, CFP®, AIF® IRA Analyst The new SECURE Act regulations, released in late February, created a firestorm of confusion and complexity. We have addressed concerns in recent Slott Report articles and will continue to do so as issues arise. However, as of now,...

By Ian Berger, JD IRA Analyst Question: Hi, I have a client that needs funds for a short period of time, so he plans to use the 60-day rollover rule to borrow money from his IRA and return it within 60 days. He has a Traditional IRA and a Roth IRA. He is under the...

By Sarah Brenner, JD Director of Retirement Education Most IRA distributions will be taxable. However, if you have ever made nondeductible contributions to your IRA or rolled over after-tax funds from your company plan to your IRA, then the rules can get a little bit...

By Ian Berger, JD IRA Analyst When you file for bankruptcy, one thing you usually don’t have to worry about is protecting your IRA funds from creditors. That’s because, in just about every case, all of your IRA (and Roth IRA) monies are off limits. Under the federal...

By Sarah Brenner, JD Director of Retirement Education Question: I established a Roth IRA in 2011 and needed to withdraw $ 30,000 in 2021 to pay for my daughter’s first year of college tuition. I am under 59 1/12 and the 1099-R has a code of J meaning early...

By Andy Ives, CFP®, AIF® IRA Analyst Here we go again. In my March 14 Slott Report entry (“Monitoring Concurrent Life Expectancies? – SMH”), I railed against the IRS for a seemingly pointless rule in the new SECURE Act regulations directed at elderly IRA...

By Sarah Brenner, JD Director of Retirement Education It may be hard to believe it but the countdown to the 2021 tax filing deadline is on. The deadline is April 18, 2022, for most filers. That is really only a few weeks away. Time is running out. Is your IRA ready?...

By Andy Ives, CFP®, AIF® IRA Analyst Question: Hey Ed- Long time reader and listener of yours…and have bought a few copies of your latest book to share with clients! Prior to us being involved, my client made a Backdoor Roth contribution in 2021. He did this despite...

By Ian Berger, JD IRA Analyst With many 401(k) (and 403(b) and 457(b) plans) offering multiple participant accounts, your plan statement is probably more complicated than ever. Here’s a brief primer to help you understand what each account represents: Pre-tax deferral...

By Andy Ives, CFP®, AIF® IRA Analyst I am usually patient with the IRS. I understand the massive workload they have, and there are tax cheats lurking around every corner. The IRS does its best to ensure no loopholes exist for bad actors to circumvent tax laws to avoid...

By Ian Berger, JD IRA Analyst Question: Ed, I read your 2/28/22 Slott Report on the updated SECURE Act information for non-eligible designated beneficiaries (non-EDBs) that requires annual RMDs to continue if the original owner was taking them prior to his death and...

By Sarah Brenner, JD Director of Retirement Education Roth IRAs have always been a great retirement savings tool. While pre-tax retirement accounts allow tax deferred savings, a Roth IRA promises tax-free benefits. They allow you to receive years of earnings in...

By Ian Berger, JD IRA Analyst The part of the new IRS SECURE Act regulations causing the most reaction is the one requiring annual required minimum distributions (RMDs) for some IRA or workplace plan beneficiaries subject to the 10-year payment rule. Under the SECURE...

By Sarah Brenner, JD Director of Retirement Education Question: Hello. I was reading the 2/28/22 edition of the Slott Report and noticed the section titled “Beneficiaries Hit w/Annual RMDs and the 10-Year Rule.” It was my understanding that starting 1/1/20, most...

By Andy Ives, CFP®, AIF® IRA Analyst The 275 pages of proposed SECURE Act regulations, released by the IRS on February 23, are chock full of little details. Each of these tidbits will have some impact on particular IRA owners and retirement account participants. One...

By Sarah Brenner, JD Director of Retirement Education On February 23, 2022, the IRS released the long-awaited proposed SECURE Act regulations. The new regulations clock in at 275 pages and offer guidance on many SECURE Act rules. They also include a few surprises....

By Andy Ives, CFP®, AIF® IRA Analyst Question: If an 80-year-old converts his IRA to a Roth account and dies the following year, when can the beneficiaries begin withdrawing money tax-free from the Roth?  Do the beneficiaries have to wait for the expiration of the...

By Ian Berger, JD IRA Analyst The amount of annual pre-tax deferrals and Roth contributions you can make to a 401(k) plan is limited by the tax code. If you exceeded that limit in 2021, time is of the essence to correct the error. If you don’t act quickly, the tax...

By Ian Berger, JD IRA Analyst The federal ERISA law gives spouses of plan participants in ERISA-covered plans certain rights to the participant’s account. There are two types of ERISA financial protection for spouses. Spouses of IRA owners usually don’t have similar...

By Ian Berger, JD IRA Analyst Question: I am 66 years old and live on Social Security and other retirement income. Additionally, I have about a half million dollars in pre-tax 457(b) funds that I do not need for current expenses. Are these funds in the pre-tax...

By Sarah Brenner, JD Director of Retirement Education The pandemic has upended the workforce. Many workers lost jobs. Some workers resigned by choice. Others were forced to leave jobs due to childcare issues. If you are not working outside the home, you may believe...

By Ian Berger, JD IRA Analyst Towards the end of each year, the IRS announces cost-of-living increases for several retirement-related dollar limits that will become effective for the next year. For example, last November, the IRS said that the limit on employee...

By Sarah Brenner, JD Director of Retirement Education Question: I turn 72 this year. I am getting notices from my many IRA custodians that they want a waiver on file if I am NOT using my account for the RMD (i.e., I am taking it somewhere else). They make it sound...

By Andy Ives, CFP®, AIF® IRA Analyst For IRA owners and retirement plan participants who are under age 59 ½, taking a distribution from a retirement account is typically off limits. The distribution will most likely be taxable, and there is a good chance that a 10%...

By Sarah Brenner, JD Director of Retirement Education If you are under age 59 ½ and you converted your traditional IRA to a Roth IRA, you will need to watch out for the five-year rule for penalty-free distributions of converted funds. Not understanding how the rule...

By Andy Ives, CFP®, AIF® IRA Analyst The “Martin Scenario”: Martin, age 40, has never done an IRA rollover before. He took a distribution from his traditional IRA in December 2021 for $10,000 and deposited it into his checking account. Martin took another distribution...

By Ian Berger, JD IRA Analyst Question: My question relates to an IRA withdrawal that is then deposited as a Roth conversion. Will this withdrawal count as a once-per-year IRA rollover? Thanks in advance for your wonderful advice. Regards, Peter Answer:  Hi Peter,...

By Sarah Brenner, JD Director of Retirement Education The rollover rules can be especially challenging at the end of the calendar year. If you took a distribution from your IRA at end of 2021 and are considering a rollover in 2022, here is what you need to know....

By Ian Berger, JD IRA Analyst 72(t) payments have suddenly become a better deal for IRA owners and company plan participants. Also known as “substantially equal periodic payments,” 72(t) payments are advantageous because they are exempt from the 10% early distribution...

By Sarah Brenner, JD Director of Retirement Education Question: Hello.  Thanks in advance for fielding my question. My mother died in 2021 in her 90's. She was using $100,000 of her traditional IRA RMD as a QCD. In order to fulfill her 2021 charitable commitments, I...

By Andy Ives, CFP®, AIF® IRA Analyst A person is allowed only one IRA-to-IRA or Roth-IRA-to-Roth-IRA 60-day rollover per year. This 12-month period is a full 12 months – it is not a calendar year. Accordingly, we refer to this as the “once-per-year rule.” For example,...

By Sarah Brenner, JD Director of Retirement Education Did you take your RMD from your IRA for 2021? Hopefully, the answer is yes because for most IRA owners and beneficiaries the deadline for taking a 2021 RMD was December 31, 2021. There is an exception. If you...

By Andy Ives, CFP®, AIF® IRA Analyst Question: Hi, I turn 72 this year and have to take my first required minimum distribution (RMD). I am also in the process of converting most of my IRA into a Roth IRA. I know I have to take my RMD first before the conversion. Since...

By Ian Berger, JD IRA Analyst As we move into 2022, small business owners may be wondering whether they still have time to establish a new retirement plan for 2021. The short answer is: “It depends.” There are several retirement plan options especially designed for...

By Andy Ives, CFP®, AIF® IRA Analyst Less than two weeks into the new year seems like a good time to provide a few reminders and warnings when it comes to Qualified Charitable Distributions (QCDs). As a quick refresher, remember these QCD facts: Only available to IRA...

By Ian Berger, JD IRA Analyst Question: Has the IRS clarified the 10-year rule on inherited IRAs? Do you have to take RMDs each year or can you wait until the 10th year? Also, does this rule apply to inherited Roth IRAs? Thanks, Daniel Answer: Hi Daniel, Yes, the IRS...

By Sarah Brenner, JD Director of Retirement Education The IRS has released new life expectancy tables for calculating required minimum distributions (RMDs) for 2022. The most commonly used tables are the Uniform Lifetime and the Single Life Expectancy Tables.  The...

By Ian Berger, JD IRA Analyst Welcome to 2022! One of the big changes in the retirement account world this year will be the calculation of required minimum distributions (RMDs). RMDs for IRA owners and plan participants are calculated using life expectancies from IRS...

By Sarah Brenner, JD Director of Retirement Education Question: Ed, Since the Build Back Better bill is still in legislative limbo, does that mean that backdoor Roth IRA contributions are still available for 2022? If so, what do you suggest if someone makes a backdoor...

By Andy Ives, CFP®, AIF® IRA Analyst SCENARIO: Teddy, age 60, has an existing Traditional IRA with a current balance of $93,000. This is all deductible, pre-tax money. Teddy would like to contribute to a Roth IRA, but his income level exceeds the Roth IRA income...

By Andy Ives, CFP®, AIF® IRA Analyst In 2021, the Slott Report produced roughly 100 diverse retirement-related articles and answered approximately 100 reader questions in our weekly Mailbag. We do our best to present topical IRA and retirement plan issues in the most...

By Sarah Brenner, JD Director of Retirement Education Pop the champagne! It is almost time to turn the page on the calendar to a new year. What will 2022 mean for your retirement accounts? All signs point to a very busy year ahead. Here is what we may expect for...

By Sarah Brenner, JD Director of Retirement Education Thanksgiving 2021 is upon us. This is the time of the year when we gather together and express our gratitude. When it comes to our retirement accounts, we often complain about the negatives. There are restrictions...

By Andy Ives, CFP®, AIF® IRA Analyst Question: Hi Mr. Slott: I enjoy your website's very helpful information! I know that the IRS rules limit us to one indirect (60-day) IRA rollover every 12-month period. Are Health Savings Account (HSA) indirect rollovers counted as...

By Ian Berger, JD IRA Analyst As 2021 draws to a close, many of us will naturally look back and try to make some sense of the past year. On the whole, it would be hard to classify 2021 as an “uneventful” year. But in the world of IRAs and workplace plans, it actually...

By Andy Ives, CFP®, AIF® IRA Analyst A “life hack” is any trick, shortcut or simple and clever technique for accomplishing a familiar task more easily and efficiently, in all walks of life. For example, tie a colorful ribbon to your luggage to make it more easily...

By Ian Berger, JD IRA Analyst Question: I have a client, age 65, who passed away and left her IRA to her estate. Two nephews and a niece are beneficiaries of the estate.  Is there a way to add beneficiaries after her passing? I spoke with a financial company, and they...

By Sarah Brenner, JD Director of Retirement Education Tis the season. Yes, it is the holiday season, and it is also the season to take RMDs. RMDs are back for 2021 after being waived by the CARES Act for 2020. With the return of RMDs come questions. One question we...

By Ian Berger, JD IRA Analyst During 2021, Congress has taken up a number of different retirement proposals, and it’s been difficult to keep track of them. Here’s an update of how things stand at the moment. Of course, new developments could occur at any time, so stay...

By Sarah Brenner, JD Director of Retirement Education Question: If the owner of an inherited IRA was required to take RMDs from the IRA prior to his death, can a beneficiary who is younger than age 70 1/2 request QCDs from the inherited IRA? Note: We understand the...

By Andy Ives, CFP®, AIF® IRA Analyst My November 29 Slott Report entry was titled “The Pro-Rata Rule Explained – You are Not Getting Taxed Twice.” I closed that article by stating there are exceptions to the pro-rata rule and ways to clean up an IRA that contains a...

By Sarah Brenner, JD Director of Retirement Education In volatile times like these, when inflation is looming, retirement savers may look to invest their IRAs in gold. Advertisements on the internet and cable tv make it look easy, but that is not the full story. The...

By Andy Ives, CFP®, AIF® IRA Analyst Question: Good afternoon, Mr. Slott. I am trying to complete my taxes for last year, and the tax agent is stating that, because I had two 401(k) rollovers (each from a different employer), that I would be charged a penalty for one...

By Ian Berger, JD IRA Analyst Many sections of the tax code are confusing, but section 457(b) is one of the major offenders. Within that section are the rules for two different types of company retirement plans --  governmental plans, and “top hat” plans for...

By Ian Berger, JD IRA Analyst Are you considering opening up a new solo 401(k) and looking to maximize your 2021 contribution? If so, you may need to act quickly. There is a December 31, 2021 deadline for establishing a new plan if you want to make 2021 elective...

By Sarah Brenner, JD Director of Retirement Education Question: Can someone take an in-service withdrawal from their 401(k) and directly transfer it to their IRA, then take a QCD from the IRA to satisfy the RMD amount attributed to the 401(k)? I am 72 years old and I...

By Andy Ives, CFP®, AIF® IRA Analyst As we careen into the holiday season, there remains a deceitful underbelly of dirtbags operating their typical scams. Giant inflatable Christmas decorations in front of your home or a menorah in the window will not dissuade...

By Sarah Brenner, JD Director of Retirement Education The IRS has released the cost-of-living adjustments (COLAs) for retirement accounts for 2022. As expected, due to inflation in the economy, many of the dollar limit restrictions on retirement accounts will increase...

By Andy Ives, CFP®, AIF® IRA Analyst Question: When calculating my required minimum distribution (RMD) amount, is my Roth IRA balance added to my traditional IRA balance? I understand I don’t have to withdraw from my Roth - just want to know how RMD’s are calculated....

By Ian Berger, JD IRA Analyst The September 29, 2021 Slott Report summarized the rules for taking non-hardship withdrawals from 401(k) plans. This article will focus on the hardship withdrawal rules. Most company savings plans allow you to pull out your funds to take...

By Andy Ives, CFP®, AIF® IRA Analyst As Roth IRA conversions become more popular, questions and misconceptions abound. In no particular order, here are a dozen Roth IRA conversion facts to be aware of: 1. Anyone with an IRA can do a Roth conversion. There are no...

By Ian Berger, JD IRA Analyst As discussed in the October 18 Slott Report, spousal beneficiaries of IRAs can take advantage of certain payout rules that aren’t available to non-spouse beneficiaries. For example, a surviving spouse who remains a beneficiary can defer...

By Sarah Brenner, JD Director of Retirement Education Question: I have four IRAs. Does the once-per-year IRA rollover rule mean I can only take one distribution per year in total or does it mean I can only take one distribution per year from each of my four IRAs? Glen...