Planning for Life

Why You Might Want a SECURE SNT

Posted by Harry S. Margolis on August 15, 2020

By Harry S. Margolis


As we've discussed before (here), the SECURE Act, passed at the end of 2019, changed a number of rules regarding inherited IRAs, making it more difficult to "stretch" them for most beneficiaries. However, an exception to the new rules could upend the advice we've often given clients doing special needs planning.

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Topics: special needs planning, Retirement Planning, Special Needs Trust

SECURE Act Complicated Things, CARES Act Further Changes IRA Withdrawal Rules

Posted by Harry S. Margolis on May 26, 2020

By Harry S. Margolis


As we explained in this post, the SECURE Act passed by Congress at the end of 2019 changed many of the longstanding rules around IRA withdrawals, eliminating the so-called "stretch" IRA for many beneficiaries and delaying required withdrawals to age 72 for those born after June 30, 1949.

New Rules Apply with passage of the CARES Act

As we've just begun getting used to these new rules, as part of the CARES Act (Coronavirus Aid, Relief and Economic Security Act), Congress made some other changes applicable only for this year. These include:

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Topics: Retirement Planning, Retirement Benefits, Required Minimum Distributions, IRA

3 Implications of the SECURE Act

Posted by Harry S. Margolis on January 14, 2020

By Harry S. Margolis


We reported on the SECURE Act when it was enacted at the end of 2019. (You can read about the rules it changed here.) Since then, we and other attorneys have been parsing it and learning a lot more about how its changes work and how they may affect clients. Here's some of our new learning:

1.  Estates in Progress May Want to Disclaim

Except for eligible beneficiaries (spouses, minor children, and disabled or chronically ill individuals), those inheriting IRAs from decedents dying this year and in the future will have to withdraw and pay taxes on the inherited accounts within 10 years from the year of the original owners death. Those who inherited IRAs from people dying before this year can continue to "stretch" out the distributions through their own lifetimes.

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Topics: Retirement Planning, Special Needs Trust, Retirement Benefits, SECURE Act

What the SECURE Act is All About

Posted by Harry S. Margolis on December 24, 2019

By Harry S. Margolis


At the end of 2019, Congress passed new rules governing retirement accounts known as the SECURE Act, an acronym standing for Setting Every Community Up for Retirement Enhancement. A big part of the bill encourages small employers to band together to offer retirement plans, which is the reason for the title. But here's what may affect you and your family:

  1. Later Required Beginning Age. For those who have not already reached age 70 1/2 by the end of 2019 (meaning they were born after June 30, 1949), they can delay taking their required minimum distributions until the April 1st of the year they reach 72, rather than 70 1/2. If you were born after June 30, 1949, you can still choose to withdraw without penalty, other than paying taxes on the amount withdrawn, any time after age 59 1/2, you just don't have to do so quite as early.
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Topics: Retirement Planning, Retirement Benefits

Not Enough Retirement Savings? You're Not Alone & It's Not Your Fault

Posted by Harry S. Margolis on August 20, 2019

By Harry S. Margolis


In her podcast series, Reset Retirement, New School of Social Research economics professor Teresa Ghilarducci interviews Baby Boomers and others about their retirement situations, which are mostly dire, and experts about why this is the case.

Very few workers today, other than public employees, have pension plans. Instead, except for Social Security, we are all dependent on our own savings. The result is that very few Baby Boomers have enough saved for retirement, with only 15 percent having more than $500,000 in savings according to the following chart:

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Topics: Retirement Planning

Risking Old Age in America

Posted by Harry S. Margolis on October 17, 2017

By Harry S. Margolis

Over 30 years ago, my father wrote a book titled Risking Old Age In America, which described the plight of seniors in the United States who faced severe income gaps, limited assistance for care at home, and deplorable nursing homes. A lot has changed since then, but many of the same challenges persist or have gotten worse.Risking-Old-Age-in-America-book-elder-law-attorney-Wellesley-MA

With the advent of the assisted living industry, there's an alternative to nursing homes. Home care services have expanded as has government assistance to pay for home care. Nursing homes have improved, and seniors enter them later in life when they need more care, meaning fewer are institutionalized for year after year.

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Topics: Retirement Planning

Are You Saving to Leave an Inheritance? Why?

Posted by Harry S. Margolis on August 29, 2016

By Harry S. Margolis


Do you hope to leave your children an inheritance? If so, what sacrifices are you willing to make to assure that you do so? Are you working longer or scrimping on spending for yourself? If so, why? Haven't you raised your children and perhaps paid expensive college tuitions? Shouldn't they be able to stand on their own two feet?

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Topics: MassHealth planning, long-term care planning, Retirement Planning

Does an Annuity Make Sense for Retirement Planning?

Posted by Harry S. Margolis on December 1, 2015

By Harry S. Margolis

There are two kinds of annuities: variable and immediate. Both can be useful for retirement planning purposes and both can be misused. Variable annuities have gotten a bad reputation in recent years because they are often sold to people, especially seniors, for whom they are inappropriate. Immediate annuities, on the other hand, may be undersold.

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Topics: Estate Planning, Retirement Planning, financial planning

How to Protect an Inherited IRA

Posted by Harry S. Margolis on January 27, 2015

By Harry S. Margolis


If you leave a 401(k) plan or individual retirement account (IRA) to your spouse, he will be able to roll it in with their own IRA. It will be subject to the same rules regarding minimum required distributions (MRDs) as apply to the retirement plans already owned. He'll have to begin taking withdrawals from them the year after he turns 70 1/2. In addition, he will receive the same creditor protection that his other retirement accounts receive—in bankruptcy proceedings, 401(k) and IRA funds are protected.

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Topics: asset protection, Retirement Planning

Is an Inherited IRA Protected from Creditors? No!

Posted by Harry S. Margolis on July 15, 2014


In general, under the 2005 Bankruptcy Code, IRAs and other retirement accounts, such as 401(k)s and SEP plans, are protected in the event of bankruptcy by the owner—which is one more reason to fund your retirement plan with as much as possible. But what about an inherited IRA? The U.S. Supreme Court decided in the 2014 case, Clark v. Rameker, that these types of retirement accounts do not enjoy any bankruptcy protection.

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Topics: asset protection, Retirement Planning, Probate Estate Administration

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