What to Know About Secure 2.0
Saving and Giving
In December 2022, the fiscal 2023 spending package was signed into law, and includes changes to the 2019 SECURE Act. The new bill, being called SECURE 2.0, includes updates that took effect January 1, 2023, and others that will begin in future years. These changes are aimed at helping save for retirement no matter your age.
For anyone with a pre-tax retirement account, such as an IRA or 401(k), at a certain age, you are required to withdraw each year. This withdrawal is called a required minimum distribution (RMD) and the amount you are required to withdraw depends on factors such as your marital status, age, and life expectancy.
- Beginning in 2023 you won't have to make an RMD until you are 73 years of age, and in 2033, the age increases to 75 years of age. Increasing the age for making a required withdrawals means you have more time to save.
- If you are turning 73 in 2023, making a gift to Jewish Family Service can help satisfy part or all of your RMD. This means your gift won't count as income and could help reduce your Medicare premium and decrease the amount of Social Security income that is subject to tax.
- You may still choose to support Jewish Family Service if you are at least 70½ years of age with a gift from your IRA, which is often referred to as an IRA charitable rollover or a qualified charitable distribution (QCD). You can give up to $100,000 from your IRA to a qualified charity, and beginning in 2024, the $100,000 limit will be adjusted for inflation.
SECURE 2.0 has also made it possible to use your QCD (once you are 70½ years of age) to make a one-time transfer of up to $50,000 to a charitable gift annuity, charitable remainder annuity trust, or a charitable remainder unitrust.
- You could receive lifetime payments that provide additional income during retirement, while also supporting the causes you are most passionate about.
- For example, a woman age 72 years of age who creates a charitable gift annuity with an QCD gift of $50,000 could receive a monthly payment of $258.84 ($3,100.08 annually) for her lifetime.*
- The QCD can count towards your RMD but does not qualify for a charitable deduction
Learn more about how these and other changes will impact adults of all ages and help you save for the future here.
Future Gift Planning
Another way to ensure you are preparing for the future is to have a current estate plan. Creating a will and/or trust will allow you to support the people and causes that matter most to you. We provide valuable resources, including a free estate planning guide that can help you create or update your estate plans. Download or request a copy of the estate planning guide here.
If you have any questions about SECURE 2.0 or how you can easily create or update your will or trust, please contact us.