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5 Random Retirement Account Trivia Questions - Ed Slott and Company, LLC
Are the current tax brackets, made “permanent” by OBBBA, really here forever?Not necessarily. The One Big Beautiful Bill Act (OBBBA) did extend the tax rates established by the 2017 Tax Cuts and Jobs Act “permanently.” But that word has a different meaning when it comes to tax law. Yes,
Six Unanswered Questions on Trump Accounts - Ed Slott and Company, LLC
A recent Slott Report article discussed “Trump accounts,” the new savings vehicle for children created by the One Big Beautiful Bill Act (OBBBA). As with most new laws, there are a number of unanswered questions about Trump accounts that need to be addressed by the IRS. Fortunately, since Trump account contributions can’t be made before July 4, 2026, the IRS should have enough time to issue guidance. Here are the some of the outstanding questions:
Mr. T: “I Pity the Fool Who Misses Their RMD” - Ed Slott and Company, LLC
Laurence Tureaud, born May 21, 1952, is better known as Mr. T. He is an actor and a retired professional wrestler. He is famous for his roles as B. A. Baracus in the 1980s television series “The A-Team” and as boxer Clubber Lang in the 1982 film Rocky III.
QCDs and 529-to-Roth IRA Rollovers: Today’s Slott Report Mailbag - Ed Slott and Company, LLC
Question:I am 70 years old and do not have to start taking required minimum distributions (RMDs) for three years. Can I do a qualified charitable distribution (QCD) from my IRA now? Or, do I have to wait until age 73 when I have to start taking RMDs?
Reporting a Recharacterization - Ed Slott and Company, LLC
While the ability to recharacterize Roth conversions was eliminated years ago, Roth contributions can still be reversed. A Roth IRA contribution can be recharacterized to a traditional IRA, or vice versa. To recharacterize an IRA contribution, the IRA custodian will transfer the funds, along with the earnings or loss attributable (“net income attributable” or NIA), from the first IRA to the second IRA. The IRA custodian may be willing to calculate the NIA, or that responsibility could fall on the IRA owner.
Roth IRA vs. Roth 401(k): Which Is Better? - Ed Slott and Company, LLC
Many of you are familiar with the tax advantages that Roth retirement accounts can bring. Although Roth contributions are made with after-tax dollars, the contributions grow tax-free, and earnings also come out tax-free after age 59½ if a five-year holding period has been satisfied.
Last Week in Chicago - Ed Slott and Company, LLC
Last week in Chicago, the Ed Slott and Company team hosted another successful 2-day advisor training program. A sellout crowd of over 260 financial professionals from across the country joined us for some intense IRA and retirement plan education. Topics included all things Roth, net unrealized appreciation (NUA), naming trusts as IRA beneficiaries, the new qualified charitable distribution (QCD) 1099-R reporting codes,
Year-of-Death RMD and RMD on Backdoor Roth: Today’s Slott Report Mailbag - Ed Slott and Company, LLC
Question:I have a client who died last month. She would have been age 83 this year. She had an IRA. Her husband, age 87, was the beneficiary of the IRA. She did not take her required minimum distribution (RMD) for 2025 before she died. He intends to do a spousal rollover by transferring the funds to his own IRA. Does he need to take the RMD prior to moving the funds?
10 Things You Should Know about Fixing Late Rollovers with Self Certification - Ed Slott and Company, LLC
When retirement account funds are on the move, things do not always go as planned. The best way to move these funds is to do so directly, but that may not always be possible. It is very common for money to be moved between retirement accounts by using 60-day rollovers. Unfortunately, the 60-day rollover deadline is often missed.
Pro Rata, Not “Double Tax” - Ed Slott and Company, LLC
The pro-rata rule dictates that when an IRA contains both non-deductible (after-tax) and deductible (pre-tax) funds, then each dollar withdrawn (or converted) from the IRA will contain a percentage of tax-free and taxable funds based on the ratio of after-tax funds vs. the entire balance in all your IRAs. When there is a mix of pre- and after-tax dollars, you cannot withdraw (or convert) just the non-deductible funds and pay no tax.
The Roth 5-Year Clock and the Pro-Rata Rule: Today’s Slott Report Mailbag - Ed Slott and Company, LLC
I am over age 59½ and have had a Roth IRA account for more than 5 years. Starting in 2025, I designated all of my contributions into my employer’s 401(k) plan as Roth contributions. If I decide to retire before I have met the 5-year requirement for the Roth 401(k) and roll over this balance to my existing Roth IRA account, which 5-year clock applies to those former Roth 401(k) dollars?
60-Day Rollovers and the Age 55 Exception: Today’s Slott Report Mailbag - Ed Slott and Company, LLC
Question: Can an IRA beneficiary do a 60-day rollover?Answer: Only a spouse beneficiary can do a 60-day rollover from an inherited IRA if the funds are moving into an IRA in her own name. If a nonspouse beneficiary takes a distribution from an inherited IRA
Double Your Pleasure – The 457(b) 2x Catch-Up - Ed Slott and Company, LLC
If you’re in a 457(b) plan and are nearing retirement, you may want to consider an often-overlooked rule that could allow you to defer twice the usual annual elective deferral limit (for 2025, $23,000 x 2 = $47,000) in the three years before retirement.
Moving Your Roth Account - Ed Slott and Company, LLC
The year 2025 has been a turbulent time for the economy. Whether due to job loss or persons seeking better investment opportunities in volatile markets, retirement account funds are on the move more than ever. Fortunately, portability between different types of retirement accounts has expanded, creating more options for those relocating their money.
How Company Plan Loans Work - Ed Slott and Company, LLC
Most company retirement savings plans, such as 401(k), 403(b) and 457(b) plans, are allowed to (but not required to) offer plan loans. According to a survey by the Employee Benefits Research Institute, as of the end of 2022, 52% of 401(k) plans allowed loans, while 84% of 401(k) participants were in plans offering them. Loans are not allowed from IRAs, SEP IRA plans or SIMPLE IRA plans.
OBBBA: No IRA Changes, but More Roth Conversions? - Ed Slott and Company, LLC
Hopefully Ed Slott and Company is your trusted, go-to source for all things IRA and retirement plan related. Let’s be clear about the “One Big Beautiful Bill Act of 2025” (OBBBA), enacted on July 4. There is no “SECURE 3.0” in this legislation. It does NOT contain any changes DIRECTLY related to IRA or retirement plan rules.
3 Retirement Account Takeaways from OBBBA - Ed Slott and Company, LLC
On July 4, 2025, President Trump signed into law the “One Big Beautiful Bill Act” (OBBBA). This mammoth domestic policy and tax law is hundreds of pages long and will impact many people in all kinds of ways. What does it mean for your retirement account? Here are 3 takeaways:
OBBBA: No IRA Changes, but More Roth Conversions? - Ed Slott and Company, LLC
Hopefully Ed Slott and Company is your trusted, go-to source for all things IRA and retirement plan related. Let’s be clear about the “One Big Beautiful Bill Act of 2025” (OBBBA), enacted on July 4. There is no “SECURE 3.0” in this legislation. It does NOT contain any changes DIRECTLY related to IRA or retirement plan rules.
How Company Plan Loans Work - Ed Slott and Company, LLC
Most company retirement savings plans, such as 401(k), 403(b) and 457(b) plans, are allowed to (but not required to) offer plan loans. According to a survey by the Employee Benefits Research Institute, as of the end of 2022, 52% of 401(k) plans allowed loans, while 84% of 401(k) participants were in plans offering them. Loans are not allowed from IRAs, SEP IRA plans or SIMPLE IRA plans.
60-Day Rollovers and the Age 55 Exception: Today’s Slott Report Mailbag - Ed Slott and Company, LLC
Question: Can an IRA beneficiary do a 60-day rollover?Answer: Only a spouse beneficiary can do a 60-day rollover from an inherited IRA if the funds are moving into an IRA in her own name. If a nonspouse beneficiary takes a distribution from an inherited IRA
10 Things You Should Know about Fixing Late Rollovers with Self Certification - Ed Slott and Company, LLC
When retirement account funds are on the move, things do not always go as planned. The best way to move these funds is to do so directly, but that may not always be possible. It is very common for money to be moved between retirement accounts by using 60-day rollovers. Unfortunately, the 60-day rollover deadline is often missed.
Pro Rata, Not “Double Tax” - Ed Slott and Company, LLC
The pro-rata rule dictates that when an IRA contains both non-deductible (after-tax) and deductible (pre-tax) funds, then each dollar withdrawn (or converted) from the IRA will contain a percentage of tax-free and taxable funds based on the ratio of after-tax funds vs. the entire balance in all your IRAs. When there is a mix of pre- and after-tax dollars, you cannot withdraw (or convert) just the non-deductible funds and pay no tax.
The Roth 5-Year Clock and the Pro-Rata Rule: Today’s Slott Report Mailbag - Ed Slott and Company, LLC
I am over age 59½ and have had a Roth IRA account for more than 5 years. Starting in 2025, I designated all of my contributions into my employer’s 401(k) plan as Roth contributions. If I decide to retire before I have met the 5-year requirement for the Roth 401(k) and roll over this balance to my existing Roth IRA account, which 5-year clock applies to those former Roth 401(k) dollars?
Double Your Pleasure – The 457(b) 2x Catch-Up - Ed Slott and Company, LLC
If you’re in a 457(b) plan and are nearing retirement, you may want to consider an often-overlooked rule that could allow you to defer twice the usual annual elective deferral limit (for 2025, $23,000 x 2 = $47,000) in the three years before retirement.
Moving Your Roth Account - Ed Slott and Company, LLC
The year 2025 has been a turbulent time for the economy. Whether due to job loss or persons seeking better investment opportunities in volatile markets, retirement account funds are on the move more than ever. Fortunately, portability between different types of retirement accounts has expanded, creating more options for those relocating their money.
RMD Calculations and Qualified Charitable Distributions: Today's Slott Report Mailbag - Ed Slott and Company, LLC
Question: I am age 85, and my wife is age 75. If I die first and my wife inherits my IRA, are the required minimum distributions (RMDs) that my wife must take after my death calculated using her age or my age?
Bad Advice Turns Me Into the Hulk - Ed Slott and Company, LLC
Before he transformed into the Incredible Hulk, Bruce Banner once said to his antagonist, “Don't make me angry. You wouldn't like me when I'm angry.” That’s a little how I feel when I hear stories about lazy financial professionals giving bad advice. Not that I’m about to turn green and rip through my clothes, but I do feel my blood start to boil.
Are My SEP and SIMPLE IRAs Safe from Creditors? - Ed Slott and Company, LLC
You are not alone if you have concerns that your IRA or workplace plan savings could be lost if you are forced to declare bankruptcy or wind up on the losing end of a civil lawsuit. After all, we all count on those savings for a financially secure retirement. Fortunately, there is usually some degree of creditor protection for retirement accounts. Unfortunately, that doesn’t seem to be the case for SEP and SIMPLE IRA plan funds. Those accounts may not always be protected against creditors.
IRA Transfers and Qualified Charitable Distributions: Today's Slott Report Mailbag - Ed Slott and Company, LLC
Hello, I have two IRA annuities with different insurance companies. One of my annuities is maturing and I would like to transfer it upon maturity to a different insurance company. Do I need to take my 2025 required minimum distribution (RMD) from the current insurance company prior to transferring the funds to a new insurance company offering a higher rate, or can I take it after the transfer?
When You SHOULD Name a Trust as IRA Beneficiary - Ed Slott and Company, LLC
Here at the Slott Report we hear many stories about trusts being named as IRA beneficiaries and the problems that follow. Often, there seems to be no purpose for naming the trust and it brings unnecessary complications. Trusts won’t help with income taxes. In fact, they can increase the tax hit because IRA funds may be subject to high trust tax rates.
Fixing a Converted RMD…and the Tax Reporting - Ed Slott and Company, LLC
Regardless of the topic, we could all use an occasional refresher. Retirement account rules are incredibly complicated, and we all have our blind spots. Even seasoned financial advisors with extensive client lists can overlook certain details. I had a conversation recently with a respected professional who was operating on a misconception regarding the still-working exception. Fortunately, we were able to identify the oversight and make the necessary corrections. But the conversation confirmed, once again, that understanding the rules is paramount to success.
Chocolate, Vanilla or Strawberry: How 401(k), 403(b) and 457(b) Plans Compare - Ed Slott and Company, LLC
Like Neapolitan ice cream, most company retirement savings plans come in three flavors: 401(k) plans if you work for a for-profit company or you’re a business owner with no employees; 403(b) plans if you work for a tax-exempt employer, a public school or a church; and 457(b) plans if you work for a state or local government.
Using Your IRA to Buy Your First Home - Ed Slott and Company, LLC
With home prices continuing to soar, many first-time homebuyers are looking for any possible source of funds to tap. IRA savings are intended to be used for your retirement. However, if you are like many others, your IRA may be your biggest asset. You may need your IRA money to make homeownership happen, and there is a special break in the tax code that can help if you qualify.