The Secure Act 2.0 is expected to become law later this week. Top measures include increasing the RMD age, raising catch-up contribution limits, and rollovers from 529 plans to Roth IRAs.
starting in 2025, the catch-up contribution will become the greater of $10,000 or 150% of the catch-up limit for individuals between age 60 - 63. Starting in 2026, the catch-up will be indexed by inflation.3. Allow companies to make 401 matching contributions based on student loan payments
The Secure Act 2.0 would permit employers to make matching contributions to an employee’s 401 and 403 retirement plan, even if the worker isn’t saving themselves. In the bill, workers facing the decision to pay off student loanssave for retirement could have a portion of their student loan payments matched by their employer and contributed to their retirement plan.are often voluntary so it would be up to the plan as to whether to adopt this provision.
Currently, the penalty for missing a required minimum distribution is a whopping 50%. The Act would cut this in half, to 25%. Also, if corrected in a timely fashion, the penalty would be reduced to 10%. This part of the bill would be effective in 2023. But in practice, just don't miss your RMD.Starting in 2023, the current $100,000 limit forwill be indexed by inflation.
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