WASHINGTON, D.C. — The Department of the Treasury and the Internal Revenue Service (IRS) have issued new final regulations that update the rules for required minimum distributions (RMDs) from retirement accounts. These changes reflect the provisions of the SECURE Act and the SECURE 2.0 Act, which aim to improve retirement savings management for plan participants, IRA owners, and their beneficiaries.
The final regulations incorporate feedback received on proposals released in 2022. While adjustments were made based on public comments, the final rules largely align with the initial proposals.
One significant aspect of the new rules is the requirement for beneficiaries to continue receiving annual distributions if the original account holder had already begun their distributions before passing away. Some commenters had suggested that beneficiaries should not be required to continue these annual payments if the account balance is fully distributed within ten years of the original account holder’s death, as stipulated by the SECURE Act. However, the Treasury and IRS decided to maintain the requirement for continuous annual payments.
In addition to the final regulations, the Treasury and IRS have also issued new proposed regulations to address further RMD issues introduced by the SECURE 2.0 Act. These proposed rules are open for public comment, allowing stakeholders to provide input on additional aspects of the RMD regulations.
For those looking to understand the detailed provisions and submit comments on the proposed regulations, the Treasury and IRS have provided specific guidelines on how to do so.
This regulatory update underscores the ongoing efforts by the Treasury and IRS to refine and clarify retirement fund distribution rules, ensuring that they align with legislative changes and meet the needs of retirement plan participants.
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