finance

SECURE ACT says Goodbye, to the “stretch” IRA

The Setting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act) significantly changed the rules for IRAs, and defined contribution plans (such as 401(k) and profit-sharing plans). Consult with your estate attorney and tax professional about how the SECURE Act might affect you. Talk to us at Stonehouse about creative solutions available to you to deal with these and other provisions of the SECURE Act, so that you can still accomplish your legacy goals.

Goodbye “stretch” IRA !

This is one of the most significant estate planning changes of the SECURE Act. For account owners who die after Dec. 31, 2019, beneficiaries may no longer spread or “stretch” IRA distributions over their lifetimes. Instead, IRAs (Roth included), must be distributed by Dec. 31 of the 10th year following the account holder’s death. Subject to new limitations, there are exceptions to the 10-year force out:

  1. Surviving spouses generally have the same options as before (spousal rollover, etc.)
  2. Beneficiaries who are less than 10 years younger than the IRA owner (for example, a sibling beneficiary) may continue to a use a lifetime distribution method.
  3. Disabled or chronically ill beneficiaries may take distributions based on life expectancy.
  4. Minor children (but not grandchildren) may delay the 10-year period until reaching the age of majority (varies by state).

During the 10-year period, there is no required minimum distribution (RMD). For example, a beneficiary could leave the entire amount in the inherited account until the end of the 10th year. The beneficiary would then take a lump sum distribution of the entire account. Alternatively, a beneficiary could spread distributions evenly over 10 years – or any combination as long at the 10-year deadline is satisfied.

Income tax impact

The 10-year force out is included in the revenue section of the Act. The message is clear: The force out is intended to generate revenue for the federal government more quickly (10 years at most). The compressed income could push beneficiaries into higher tax brackets creating a tax “double whammy” (compressed income taxed at a higher marginal rate).

IRA owners and beneficiaries should work closely with tax advisors to determine the distribution pattern that makes the most sense. In some cases, a 10-year distribution pattern to prevent bracket creep may be advantageous. In others, a lump sum distribution may be appropriate (for example, taxpayers with significant tax deductions).

Call me at Stonehouse, for more information about the SECURE Act.  I will help you identify issues and strategies to address them, so we can decide with your estate planning attorney and tax professional what strategies you should be considering.

<strong>Be Well, </strong><br>Tom Somers
Be Well,
Tom Somers

CERTIFIED FINANCIAL PLANNER™ at Stonehouse Insurance Services | 951.972.8100

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covid19

Dear Clients, Partners, Friends, and Family,

It has been a month since we launched our first issue of The Stonehouse Report.

Some key updates I wanted to address in this issue are around the misinformation that is out there concerning who is eligible for the SBA PPP loan/grant, and how to apply for it through your existing bank

Many employers right now, have been led to believe they are not eligible for the SBA PPP loan/grant because they don’t have employees. That is incorrect, sole proprietors, independent contractors, and officers of a corporation who are W2 employees, are eligible for the PPP loan/grant.

If you have been misled, our sister company Stonehouse Consulting, is providing professional assistance in filing these SBA loan documents on your behalf. Stonehouse Consulting, is ready and able to assist you filing the loans that are available, for an affordable cost. If you still have not filed for any of the SBA loans that are available, please [CLICK HERE] & see below the Stonehouse Consulting piece for more information.

Second key update is, our Financial Dept. Manager at Stonehouse Insurance, Tom Somers, has launched a new blog, called “From The Desk of Tom Somers”. This week’s headlines from Tom are “Need life insurance to secure an urgent SBA loan!?” “SECURE ACT says Goodbye, to the “stretch” IRA” See below to learn more from Tom…

We want to encourage you to visit our website for updates on COVID-19 resources. We will be updating the page weekly.

As today marks Good Friday, beginning of Passover, and Easter weekend, please know you are all in our thoughts and prayers during this time.

<strong>Best, </strong><br>Joshua T. Emerson
Best,
Joshua T. Emerson

Agency Manager at Stonehouse Insurance Services | 951.760.9429


COVID-19 LAWSUITS – FACE MASK SAFETY VIOLATIONS

“Walmart, the largest private employer in the United States, is a defendant in one of the first COVID-19 lawsuits filed by an employee against an employer.”


STONEHOUSE CONSULTING

ARE YOU UNSURE WHERE TO GO FROM HERE WITH YOUR BUSINESS? DO YOU NEED EXECUTIVE BUSINESS CONSULTING GUIDANCE? We have 40+ years of international consulting experience on staff. Our staff is ready and able to setup a ZOOM consulting session with you today. Please visit our website below to make an appointment.


FROM THE DESK OF:
TOM SOMERS.

CERTIFIED FINANCIAL PLANNER™

Many business owners are struggling with what to do in this up and down financial environment. At Stonehouse Insurance we specialize in guaranteed insurance products. We also partner with local financial representatives. We encourage you to speak with Tom today, to discuss your individual needs.

Tune in to this weeks article from the desk of Tom Somers.
“Need life insurance to secure an urgent SBA loan!?” “SECURE ACT says Goodbye, to the “stretch” IRA”
…CLICK BELOW TO READ MORE…


INSURANCE REVIEWS

WE ARE SAVING NEW CLIENTS CRITICAL NEEDED MONEY $$$

Is your current agent reviewing your sales, and payroll during this COVID-19 pandemic, to help cut your costs? Ask us to help you review your sales, payroll, and property that may directly impact your current rates.

ASK FOR JOSH EMERSON.
JOSH@STONEHOUSEINS.COM
STONEHOUSE DIRECT 951-760-9429


INSURANCE CLAIMS

ARE YOU GETTING THE HELP YOU NEED FOR YOUR BUSINESS?

Is your current agent helping you file a claim, or walk you through the process. If not please call us today, and we can help you file a claim on your current insurance policy.

Please call or email us today: info@stonehouseins.com
STONEHOUSE DIRECT 951-760-9429


CA GO-BIZ WEB PAGE

“The Governor’s Office of Business and Economic Development (GO-Biz) has compiled helpful information for employers, employees, and all Californians as it relates to the Coronavirus (COVID-19) pandemic.” For a complete list of resources, [CLICK HERE] 

Please call or email us today:info@stonehouseins.com
STONEHOUSE DIRECT 951-760-9429


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