By Andy Ives, CFP®, AIF® IRA Analyst Charlie Brown, wearing a ghost costume full of too many eye holes cut in all the wrong spots, famously peered into his trick-or-treat bag and said, “I got a rock.” One of the best parts of Halloween remains. It is the moment at the...

By Sarah Brenner, JD Director of Retirement Education Not everyone has a boss. In an economy upended by COVID, individuals, sometimes by choice and sometimes not, are striking out on their own and starting new businesses or becoming part of the gig economy. A critical...

By Andy Ives, CFP®, AIF® IRA Analyst Question: My situation is as follows: I am 56 years old and have an IRA which I have been taking SEPP/72(t) payments since 2008. I have not yet taken my distribution in 2021. I recently received a finding of disability from SSA...

By Ian Berger, JD IRA Analyst One question that continues to come up is whether company retirement plan dollars are protected from creditors. This becomes an issue if you are forced to declare bankruptcy or you owe money after a legal action is brought against you. If...

By Andy Ives, CFP®, AIF® IRA Analyst When a married IRA owner dies, the surviving spouse is oftentimes the beneficiary. Of course, there are instances where a trust might be named as IRA beneficiary, or the children or a charity or someone else is listed. Regardless,...

By Ian Berger, JD IRA Analyst Question: I am retired and turned 72 in September, 2021, so I must begin required beginning distributions (RMDs) by April, 2022. I have traditional and Roth IRAs as well as a defined contribution plan with a former employer. I understand...

By Sarah Brenner, JD Director of Retirement Education As you approach your golden years, you may be looking to simplify your life to wring the most out of retirement. It may be time to right size and move from a larger house with an abundance of maintenance to a...

By Ian Berger, JD IRA Analyst The Build Back Better Act of 2021, recently passed by the House Ways and Means Committee, includes a number of retirement plan provisions.  They were summarized in the September 22, 2021 Slott Report. Two of those provisions are targeted...

By Sarah Brenner, JD Director of Retirement Education Question: Dear Ed Slott and Company, I am a longtime subscriber, having met and talked with Ed at several industry conferences, going back well over 20 years. Which, with all of Ed’s great work and active...

By Andy Ives, CFP®, AIF® IRA Analyst When it comes to taxes and the 10% early distribution penalty, do not allow the underlying investments within a Traditional IRA to confuse what is applicable. Earnings within an IRA are just earnings. It does not matter if those...

By Sarah Brenner, JD Director of Retirement Education It’s hard to keep up with the news out of Washington these days! We have been getting a ton of questions on how the new tax proposals recently passed by the House Ways and Means Committee would impact Roth...

By Andy Ives, CFP®, AIF® IRA Analyst Question: Good morning, I have an inherited IRA. I took a manual withdrawal from it in late August. I thought I had deleted my auto withdrawal on the custodian’s website. I just noticed today that another distribution was taken on...

By Ian Berger, JD IRA Analyst Congress designed 401(k) plans as retirement savings vehicles – not as checking accounts. So, there are restrictions on when employees can make “in-service withdrawals” (i.e., withdrawals  while still working). It’s important to remember...

By Andy Ives, CFP®, AIF® IRA Analyst In most states the legal age for alcohol consumption is 21. And you must actually be 21. When you hand your driver’s license to the bouncer and he shines a little flashlight on your date of birth, it is not good enough to say you...

By Sarah Brenner, JD Director of Retirement Education The House Ways and Means Committee has released a draft of proposed changes to retirement accounts, including adding income limits for conversions and eliminating the back-door Roth conversion strategy. These...

By Ian Berger, JD IRA Analyst Question: If your employer contributes to either a SEP IRA or a SIMPLE IRA, can you (the employee) also contribute to a Roth IRA? Regards, Alfred Answer: Hi Alfred, Yes, you can make Roth IRA contributions even if you participate in a SEP...

By Ian Berger, JD IRA Analyst Are you moving assets between IRAs or from a company plan to an IRA (or vice-versa)? You should know that using a direct transfer is a much better idea than doing a 60-day rollover. Direct transfers avoid all of the possible issues which...

By Andy Ives, CFP®, AIF® IRA Analyst When an IRA owner taking required minimum distributions (RMDs) dies before removing his annual RMD, that year-of-death RMD (or whatever portion remains) must still be withdrawn. Upon passing, the year-of-death RMD immediately...

By Sarah Brenner, JD Director of Retirement Education President Biden has declared September to be National Preparedness Month. The goal is to encourage Americans to be more prepared for natural disasters. Unfortunately, from flooding on the east coast to fires on the...

By Sarah Brenner, JD Director of Retirement Education Question: Ed I heard on a podcast that you are the number one authority on IRAs, so I want to go to the most informative source.  Could you answer this question for me? I have a Roth IRA and suddenly I was unable...

By Ian Berger, JD IRA Analyst What if you have an IRA with your spouse as primary beneficiary, get divorced without changing your beneficiary and then die? Who inherits your IRA benefits. If you live in one of the 26 states (as of June 2018) that have...

By Andy Ives, CFP®, AIF® IRA Analyst Question: I appreciate all of the information you pass along, both through PBS and now through the American College. In one of your recent presentations, you discussed QCDs and their often-overlooked value. I recommend QCDs to...

By Andy Ives, CFP®, AIF® IRA Analyst Yes, you are allowed to own real estate in an IRA. Of course, not every IRA custodian will accommodate such an investment, but that doesn’t mean it is forbidden. If you want to own a beach house in your IRA, or a commercial...

By Sarah Brenner, JD Director of Retirement Education The other day an advisor called us with an issue that comes up frequently, especially in these tumultuous times. His client had made an IRA contribution for 2021 and was planning on deducting that contribution....

By Ian Berger, JD IRA Analyst Question: I am 72 years old and have a Roth IRA. I have some extra cash in a bank account. Can I put that into my Roth IRA and how much can I contribute for 2021? Answer: You could potentially contribute up to $7,000 to a Roth IRA this...

Ian Berger, JD IRA Analyst In the August 16, 2021 Slott Report, we showed that someone participating in a 401(k) plan through a “regular” job could also establish a solo 401(k) plan through a side job and potentially contribute up to $58,000 this year in after-tax...

By Andy Ives, CFP®, AIF® IRA Analyst Recently, I had a conversation with an advisor who wanted a second opinion. He disagreed with how a 401(k) custodian was handling his client’s required minimum distribution (RMD). To arm himself with facts, the advisor contacted us...

By Sarah Brenner, JD Director of Retirement Education Question: Ed, My client recently passed away at the age of 86 and the beneficiaries were his twin grandchildren who are six years old.  Does their 10-year clock to withdraw the funds start right away, or can they...

By Sarah Brenner, JD Director of Retirement Education It’s back to school time! Any parent will tell you that education can be expensive. You cannot afford to miss out on any possible option out there that may help you save. One savings tool that you might overlook is...

By Ian Berger, JD IRA Analyst We continue to get lots of questions about the company savings plan contribution limits. There are actually two different contribution limits – the “deferral limit” and the “overall limit.” This makes things very confusing, especially if...

By Andy Ives, CFP®, AIF® IRA Analyst Question: I read of a way to move money from an IRA to a Roth without incurring any taxes. You set up an IRA account and make a non-deductible contribution of $6,000, then you convert it into a Roth.   Is this legal and possible?...

By Andy Ives, CFP®, AIF® IRA Analyst Regardless of whether you open an IRA, participate in a 401(k) plan, buy a life insurance policy, or start a college saving plan for a child, there is a critical detail which should never be overlooked: naming a beneficiary....

Sarah Brenner, JD Director of Retirement Education A Qualified Charitable Distribution (QCD) is a way for you to move funds out of your IRA to a qualifying charity income tax free. This can be a great strategy for those who are charitably inclined and looking to save...

Ian Berger, JD IRA Analyst Question: Can you put funds into a Roth IRA for a 14 year old using money you have paid the child for doing chores? Client was told all he needed to do was keep a record of what was paid by to the child. I have always enjoyed your...

Ian Berger, JD IRA Analyst Suppose you inherit 401(k) (or other ERISA plan) funds and then file for bankruptcy before receiving those funds. Can you lose those 40(k) dollars to your bankruptcy creditors? According to a recent decision of a Bankruptcy Court in North...

By Sarah Brenner, JD Director of Retirement Educations Question: If you are an employee who participates in a 401(k) who retires at age 73, do you have to take an RMD in the year you retire, or can you take your RMD by April 1 of the year following retirement? If you...

By Sarah Brenner, JD Director of Retirement Educations You may be familiar with Health Savings Accounts (HSAs). These accounts have been around now for a while. They work with high deductible health insurance and are known for their triple tax benefits. Contributions...

By Ian Berger, JD IRA Analyst It’s that time of the year! College bills for the Fall semester are arriving, and you may be thinking of tapping into your retirement savings to help with the costs. If you’re under age 59 ½, be careful. Your withdrawal may be subject to...

By Sarah Brenner, JD Director of Retirement Education Question: Hi, I have a client who died in 2021 before taking his 2021 RMD. He designated various charities as beneficiaries of his IRA. The IRA custodian is advising the executor to take the RMD, however according...

By Andy Ives, CFP®, AIF® IRA Analyst 1. What is the NUA (Net Unrealized Appreciation) tax break? It is the opportunity to pay tax at long-term capital gains rates on the appreciation of company stock held within a company plan vs. paying ordinary income rates on that...

By Sarah Brenner, JD Director of Retirement Education On July 15 and 16, financial advisors from around the country gathered virtually for Ed Slott and Company’s Instant IRA Success workshop. We took a deep dive into the rules governing retirement accounts and engaged...

Ian Berger, JD IRA Analyst Question: Mr. Slott, Would a person who took a Coronavirus-Related Distribution from his IRA in 2020, with intent to repay within 3 years, be disqualified from taking a distribution and making a 60-day rollover in 2021 if it is within 12...

Ian Berger, JD IRA Analyst In the May 17, 2021 Slott Report, we discussed the rules governing required minimum distributions (RMDs) from defined benefit (DB) plans, also known as “pension plans.” We said that DB plan payments usually have no problem satisfying the RMD...

By Andy Ives, CFP®, AIF® IRA Analyst A surviving spouse has a number of options regarding how to deal with IRAs inherited from his or her deceased spouse. The age of both the deceased and surviving spouse will most often dictate the decision as to how to proceed....

Sarah Brenner, JD Director of Retirement Education Question: Ed, I recently saw an email from you on QCDs when deductible IRA contributions are made in the same year. It discussed how these two transactions interact with each other. I am also wondering if the offset...

Sarah Brenner, JD Director of Retirement Education When you contribute to a traditional IRA you make a deal with Uncle Sam. You can get a tax deduction and tax deferral on any earnings in your IRA. However, eventually the government is going to want its share and will...

By Andy Ives, CFP®, AIF® IRA Analyst Question: Hi. My name is John and I have a Roth question. I have read your most recent book but did not find the answer to this question. I have made non-deductible contributions to a traditional IRA for many years, so about half...

Ian Berger, JD IRA Analyst Would you like to make charitable donations from your IRA but aren’t eligible for a qualified charitable distributions(QCD) because you’re under age 70 ½? Are you eligible for QCDs but want to donate more than the $100,000 annual limit? Are...

By Andy Ives, CFP®, AIF® IRA Analyst By now, we all know the SECURE Act outlined a group of people that are still permitted to stretch inherited IRA payments over their own single life expectancy. This group is called “eligible designated beneficiaries” (EDBs). Yes,...

Ian Berger, JD IRA Analyst Question: I rolled over an IRA in March 2021 from an TD Ameritrade institutional account to a TD Ameritrade retail account. I currently would like to do a 60-day short-term rollover. Would this not be allowed because of the one rollover per...

Sarah Brenner, JD Director of Retirement Education The pandemic has upended the workplace and caused many people to rethink their career path. For some older workers this may mean considering early retirement. For those workers, access to retirement savings can be...

Ian Berger, JD IRA Analyst Follow Us on Twitter: @theslottreport In the June 16, 2021 Slott Report, we discussed how an in-service distribution made in the year of separation from service can inadvertently create an excess IRA contribution if that distribution is...

Sarah Brenner, JD Director of Retirement Education Question: A client of mine born in 1952 passed away in March 2021 and the IRA passed to her mother who is 91 years old. So, the 10 year rule applies to liquidate the IRA as she is not an eligible designated...

By Andy Ives, CFP®, AIF® IRA Analyst A required minimum distribution (RMD) from a 401(k) (or other employer plan) must be taken prior to rolling remaining plan dollars to an IRA. An RMD cannot be rolled over, so it must be withdrawn before any rollover is completed....

Sarah Brenner, JD Director of Retirement Edcuation June is PRIDE Month. This June also marks the sixth anniversary of the landmark Supreme Court case Obergefell v. Hodges, which legalized same-sex marriage. In the wake of this decision, millions of same-sex couples...

By Andy Ives, CFP®, AIF® IRA Analyst Question: How can the beneficiaries of an estate roll a 401(k) paid to the estate to a Roth IRA? What steps must be taken? Bob Answer: Bob, Inherited IRAs cannot be converted to inherited Roth IRAs, but inherited 401(k) plans can...

By Ian Berger, JD IRA Analyst On April 14, we reported that the IRS was apparently interpreting the SECURE Act's 10-year payout rule in a surprising way – to require annual required minimum distributions (RMDs). Now, the IRS has made it clear (without actually saying...

By Andy Ives, CFP®, AIF® IRA Analyst With the passage of the SECURE Act, once common IRA beneficiary planning strategies have been upended. For example, no longer can just anyone stretch payments on an inherited IRA. You must qualify as an “eligible designated...

By Ian Berger, JD IRA Analyst Question: Hi! I attended the February 2021 IRA seminar and had a question re: Roth conversions.  The seminar discussed rolling over assets held in a company plan into a Roth IRA. I’m dealing with a client that wants to roll over a lump...

By Sarah Brenner, JD Director of Retirement Education It has been well over a year since the SECURE Act became a reality, transforming the rules for inherited IRAs and doing away with the stretch IRA for most beneficiaries. While the SECURE Act statute gave us...

By Sarah Brenner, JD Director of Retirement Education Question: We have a client that owns two substantial IRA accounts plus a smaller beneficiary IRA.  Does the beneficiary IRA have its own RMD rules (the client has owned it for 10 years and has been taking RMD’s...

By Ian Berger, JD IRA Analyst One of the cardinal sins you can commit with an IRA rollover is to run afoul of the IRS “once-per-year” rollover rule. Violating that rule triggers a taxable distribution and the 10% early distribution penalty if you are under age 59 ½....

By Andy Ives, CFP®, AIF® IRA Analyst An IRA owner can contribute only so much to a Traditional and/or Roth IRA annually. The IRA owner must also have earned income. The contribution limit for 2021 is $6,000, with a catch-up provision of another $1,000 for those age 50...

By Andy Ives, CFP®, AIF® IRA Analyst Question: Dear Mr. Slott, I really enjoy your publications, website and educational programming on Public Television. You provide a tremendous service and information for investors and advisors alike. My questions pertains to...

By Sarah Brenner, JD Director of Retirement Education The SECURE Act may have upended the rules for inherited IRAs, but the rules for spouse beneficiaries remain as advantageous as ever. In fact, naming a spouse as an IRA beneficiary is a better option than ever...

By Ian Berger, JD IRA Analyst Rules governing defined benefit (DB) plans are typically more complicated than defined contribution (DC) plan rules. But required minimum distributions (RMDs) are one area where the DB plan requirements are easier to understand. If you’re...

By Ian Berger, JD IRA Analyst Question: Good afternoon. We have a client who was 19 years younger than her spouse. He passed away this year. We are planning to keep this as an inherited IRA for now. Can we move the assets to her own IRA at any time? Thank you, stay...

By Andy Ives, CFP®, AIF® IRA Analyst As we inch toward the extended 2020 tax deadline of May 17, many filers are still laboring over their returns. Some are completing the final return for a loved one lost in what was a brutal year. As is human nature, most taxpayers...

By Sarah Brenner, JD Director of Retirement Education On May 5, the House Ways and Means Committee unanimously passed the Securing a Strong Retirement Act of 2021. According to lawmakers, the proposal is designed to pick up where the SECURE Act of 2019 left off and...

By Sarah Brenner, JD Director of Retirement Education Question: I am 83 years old with an IRA rollover account, regular IRA account and a small Roth IRA. If I convert a portion of either the rollover or regular IRA to a Roth IRA and die before 5 years after the...

By Andy Ives, CFP®, AIF® IRA Analyst When visiting the doctor, does he or she ask foundational questions to help determine your medical condition? Of course. “How are you feeling?” “Are you a smoker?” “What hurts?” Does the doctor take some basic measurements –...

By Sarah Brenner, JD Director of Retirement Education Good news for retirement savers! There is more time to make your 2020 IRA contribution. On March 17, 2020, the IRS extended the 2020 federal income tax-filing deadline to May 17, 2021. The extension also extends...

By Ian Berger, JD IRA Analyst If you sponsor a solo 401(k) plan, beware! The IRS recently announced that it is targeting several employer plan areas for stepped-up auditing. One of those areas is solo 401(k) plans. The fact that solo plans made the list is a signal...

By Ian Berger, JD IRA Analyst Question: Your newsletter is so helpful, and your book was a great resource to me when my mom passed away 5 years ago and I inherited her IRA. I am 76 and have not taken my RMD for 2021. Should I pass away and my wife age 69 transfers my...

By Andy Ives, CFP®, AIF® IRA Analyst This question (or a derivation of it) has been popular as of late: “I only participated in my 401(k) for a couple of months in 2020 before I was laid off. Does that still make me a ‘covered’ employee, and can I contribute to my...

By Sarah Brenner, JD Director of Retirement Education The IRS has delayed the deadline for filing federal income taxes until May 17, 2021. This also extends the deadline for making a 2020 Roth IRA contribution. A Roth IRA offers the promise of tax-free withdrawals in...

By Andy Ives, CFP®, AIF® IRA Analyst With all the recent changes to IRAs under the SECURE Act [i.e., required minimum distribution (RMD) age raised to 72, new rules for beneficiaries, etc.], combined with the CARES Act waiver of RMDs last year, it comes as no surprise...

By Sarah Brenner, JD Director of Retirement Education Question: A new customer came to me asking for help with an IRA. Unfortunately, he had already accepted a check from the 401(k) plan made out to him personally. He sat on the check for 5 months and deposited it...

By Ian Berger, JD IRA Analyst Just a few weeks after the start of the baseball season, the IRS has thrown us a curveball by apparently interpreting the SECURE Act 10-year payout rule in a totally-unexpected way. We say “apparently” because the IRS explanation isn’t...

By Andy Ives, CFP®, AIF® IRA Analyst Question: Hi, I inherited my husband's 401(k) when he died last year. I kept the assets with the 401(k) administrator, believing I had to do that to take distributions without 10% penalty. (I am under 59 ½ years old). If I roll...

By Sarah Brenner, JD Director of Retirement Education Required minimum distributions (RMDs) were waived for 2020 but they are back now for 2021. This includes the RMD for the year of death of the IRA owner. The rules for this RMD can be tricky. One question that comes...

George Nichols III is the 10th President and Chief Executive Officer in The American College of Financial Services’ storied history. He continues to take motivation from founder Solomon Huebner’s pioneering vision in 1927, while empowering The College to usher in the...

By Ian Berger, JD IRA Analyst Question: Hi, Ed, I am hoping I get to attend one or more of your events IN PERSON this year! If you have time for a refresher . . . . Jon’s 2021 RMD is $200k. He takes $100k as a distribution to himself in February and later, he decides...

By Andy Ives, CFP®, AIF® IRA Analyst In my blog entry from March 22, I discussed the formula for calculating the amount of a direct Roth IRA contribution when your income falls within the Roth phaseout limits. Another common phaseout covers how much of a Traditional...

By Sarah Brenner, JD Director of Retirement Education Question: Has the deadline to make an IRA contribution for 2020 been extended since the 2020 tax filing date has been extended to May 17, 2021? Robert Answer: Hi Robert, Yes. The 2020 IRA contribution deadline is...

By Ian Berger, JD IRA Analyst Fewer and fewer workers are participating in defined benefit pension (DB) plans these days. The high cost of maintaining those plans has led many employers to terminate existing plans and dissuaded many others from setting up new plans in...

By Andy Ives, CFP®, AIF® IRA Analyst When it comes to contributing directly to a Roth IRA, an individual must have modified adjusted gross income below a certain level. This income level cutoff is not a “cliff,” meaning if you go one dollar over the level, you do...

By Andy Ives, CFP®, AIF® IRA Analyst Question: Hi, I found you by searching to find out if we can offer two SIMPLE IRA options for our employees. I don't know if that is something permitted. The idea is to have a cryptocurrency option set up as a SIMPLE in addition to...

By Sarah Brenner, JD Director of Retirement Education The CARES Act waived required minimum distributions (RMDs) for 2020, but they are back for 2021. The return of RMDs for this year has raised questions about how these distributions should be calculated. Here is...

By Ian Berger, JD IRA Analyst We’ve been getting a number of questions lately about whether it’s too late to set up a new solo 401(k) plan for 2020. The answer is “sort of.” Business owners with no employees (other than a spouse) can contribute to a solo 401(k) plan....

By Ian Berger, JD IRA Analyst Question: I have self-directed traditional and Roth accounts at an SDIRA Custodian.  Can I do a Roth  conversion of an illiquid asset from the traditional to the Roth account?  The investment I want to convert is a debt-only asset (no...

By Andy Ives, CFP®, AIF® IRA Analyst Follow Us on Twitter: @theslottreport Casinos have house rules. These rules dictate what patrons can and cannot do. They are often written down, posted, and there is no debating the validity of said guidelines. House rules govern...

By Sarah Brenner, JD Director of Retirement Education Follow Us on Twitter: @theslottreport For those just starting out, saving for retirement can be challenging. For young workers, paying the rent and buying the week’s groceries may take priority and there is only so...

By Sarah Brenner, JD Director of Retirement Education Question: I am 75 years old and am planning to retire this year.  I have a 401(k) plan with my employer and, I assume, need to roll it over into an IRA.  In this case do I need to take a 2021 RMD?  If so, how is it...

By Ian Berger, JD IRA Analyst For an area as highly regulated as IRAs and company plans, it’s not surprising that there’s a ton of abbreviated terms to keep track of. Here’s 18 common ones that you should know: CARES Act. The Coronavirus Aid, Relief, and Economic...

Thursday, February 25, 2021 A Preview of Ed Slott’s New Book: The New Retirement Savings Time Bomb By Ed Slott, CPA If you’re a dedicated Ed Slott and Company fan, at this point, you’ve likely heard about my upcoming new book, The New Retirement Savings Time...

By Sarah Brenner, JD Director of Retirement Education Have you contributed to a Roth IRA for 2020? If you have not, you still have some time. The deadline for making a prior year contribution is the tax-filing deadline, not including any extensions you might have. For...

By Ian Berger, JD IRA Analyst When we think of rollovers, we normally think of moving funds from a 401(k) (or other company plan) to an IRA. But it sometimes makes sense to consider a “reverse rollover” – from an IRA to a 401(k). Unfortunately, although 401(k) plans...

By Ian Berger, JD IRA Analyst Question: Hi, I have a client that took a $14k IRA distribution on 1/10/2021 and another $14k distribution on 2/10/2021. He wants to replace all $28k using the 60 day rollover as funds are no longer needed. Does the 60 day rollover rule...

By Andy Ives, CFP®, AIF® IRA Analyst Surprisingly, the rules governing what happens when an ex-spouse acquires a Roth IRA after divorce are unclear. There are no specific directions in the Tax Code or in the regulations. However, there is definitive guidance for a...