IRA Changes due to SECURE Act: Designated Beneficiary Election Form

As a current user of Compliance Systems’ Tax Favored Plan documents, we would like to provide you with information regarding changes made to Individual Retirement Accounts (IRAs) by the Setting Every Community Up For Retirement Act of 2019 (SECURE Act of 2019). Under the SECURE Act of 2019, many nonspouse IRA beneficiaries are now required to withdraw funds from Inherited IRAs within 10 years following the IRA owner’s death. However, the opportunity to spread out the distribution of Inherited IRA assets over a beneficiary’s life expectancy remains intact for some types of IRA beneficiaries. Because of the short time frame from the passage of the SECURE Act and its effective date, we understand the challenge this has put on IRA providers, and we want to help minimize disruption to your organization until we receive further guidance from the IRS on the new changes to the beneficiary election options. In the interim, we are providing you with an Eligible Designated Beneficiary Election Form to assist your customers or members with making a beneficiary distribution option for an IRA owner who passed away after December 31, 2019. Please note that this form is limited to Eligible Designated Beneficiaries of an IRA owner who passed away after December 31, 2019, and it is not designed for use by nonperson beneficiaries, trust beneficiaries, or for Eligible Designated Beneficiaries when the IRA owner passed away before January 1, 2020.

Compliance Systems will continue to monitor for any further guidance on these changes and will be making changes to our solution as necessary with more information to follow.If you have questions, please contact Compliance Systems’ Client Support department at support@compliancesystems.com, and we will be happy to assist you.

The content contained in this correspondence and the Eligible Designated Beneficiary Distribution Election shall not be construed as legal advice: Compliance Systems and its products and services (1) are not in any way a substitute for the advice of an attorney and (2) do not constitute legal advice or counsel of any sort, in any jurisdiction, on any matter.