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A summary of the SECURE Act

As an early holiday present for some, Congress passed (and the President signed into law) two spending bills, one of which contained the provisions for the Setting Every Community Up for Retirement Enhancement Act of 2019 (the “SECURE Act”). The purpose of the SECURE Act, which has been sitting in Congress for months, is to enhance opportunities for people to increase their retirement savings and ease administration of qualified retirement savings plans for employer sponsors. This post will provide an overview of the SECURE Act’s most notable changes to retirement plans and how employers, as well as employees, will be impacted.

New hardship distribution rules and how plan sponsors should respond

Because hardship withdrawals permanently reduce an employee’s account balance, the IRS has placed stringent rules on how and when a participant can take a distribution — even if it’s for a financial need. The IRS has issued final rules that will relax some of the more arduous guidelines. The new guidelines are set to take effect January 1, 2020, and some of them are mandatory for plan sponsors to adopt.

eBook: Business succession planning: Protecting your financial security and your company’s future

Assuming a significant portion of the assets that you have accumulated are in the form of a privately held business, planning is important, and so is timing Unfortunately, life doesn’t come with guarantees. That calls for contingency planning to make sure that you or your family receive a realistic value for the equity stake you have in your business in the event of the unexpected.

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