Why now is a good time to give
This is a great time to be charitable!
The Setting Every Community Up for Retirement Enhancement (SECURE) Act was enacted Jan. 1, 2020. This legislation marks the most significant changes to retirement security since the Pension Protection Act of 2006. If you are planning for retirement, retired, or are retiring in the near future, we advise you to read the following:
What changed
- You can contribute to your IRA longer. You can now contribute to your IRA past the age of 70½, allowing you more time to save.
- The required minimum distribution (RMD) age changed. The SECURE Act changed the age at which you must start taking RMDs from your retirement account from 70½ to 72. This change gives your account additional time to grow the funds in your account before you have to start withdrawing from it.
- IRA beneficiary rules changed for most non-spousal beneficiaries. If you name someone other than your spouse as the beneficiary of your IRA, they now have to withdraw the entire amount within 10 years (previously, they could stretch this over their lifetimes).
What stayed the same
- If you are 701/2 or older, you can still withdraw funds with no penalty. You can still access your retirement savings prior to 59½, but there is a 10% early penalty withdrawal. The new law allows for an aggregate amount of $5,000 to be distributed from a retirement plan without a 10% penalty in the event of a qualified birth or adoption.
- Spouses can still take distributions throughout their lifetimes. When you name your spouse as the beneficiary of your IRA, they can continue to take distributions from the account throughout their lifetime.
- IRA owners age 70½ and older can still make qualified charitable distributions (QCDs) to qualified charities. You may transfer up to $100,000 per year directly to a qualified charitable organization without paying income tax on the distribution.
Disclaimer: The information above is intended to assist you in your tax, estate, and charitable planning. It is not legal advice and should not be relied upon as such.
If you are considering supporting Anatolia College, we advise you to talk to your tax or financial advisor in order to determine the best giving options for you.