Trade Publication Article

SECURE Developments: The Final and New Proposed RMD Regulations

Harrison, Lisa Erb, Ferguson, Audra J, Knowles, Lindsay, Schaeffer, Shalina Ann, Gauss, Robert L, Sciscoe, Tara Schulstad

2025

Overview

For defined contribution plans, a member's interest upon death must be distributed within specified time frames depending on the type of beneficiary, as follows: * Within five years to a non-individual beneficiary; * Within 10 years to an individual designated beneficiary; and * Within 10 years to an eligible designated beneficiary unless the eligible designated beneficiary elects distributions over the beneficiary's life expectancy; provided that if the eligible designated beneficiary is a minor child, the interest must be fully distributed by age 31. Public Safety Health Insurance Premium Deductions The Final Regulations clarify that a distribution under Code Section 402(1) (distributions with respect to eligible retired public safety officers to pay health insurance premiums) will count towards the individuals RMD for the applicable year. Annuity Contract Purchased Under a Defined Contribution Plan The Final Regulations confirm that payments under an annuity contract purchased under a defined contribution plan cannot extend past the otherwise applicable full distribution deadline (i.e., for a designated beneficiary, the ten-year rule). The Proposed Regulations would establish that a distribution from a designated Roth account in a year in which the employee is required to take an RMD does not count toward the RMD requirement. [...]the Roth distribution would be eligible to be rolled over to a Roth IRA if it otherwise meets the requirements for an eligible rollover distribution.

• Publisher: Aspen Publishers, Inc
• Subject: Age / Beneficiaries / Compensation plans / Compliance / Defined benefit plans / Defined contribution plans / Employers / Excise taxes / Life expectancy / Public safety / Regulation / Retirement