The SECURE Act 2.0 was passed by Congress as part of the larger omnibus bill.  Several changes affect IRA, 401k and 529 accounts.  Very few changes go into effect in 2023.  Most will go into effect beginning in 2024.  This is a quick summary of key changes. 

  • RMDs starting at age 73 for clients turning 72 this year, 75 for those turning 73 in 2023
  • Roth SEP and Roth SIMPLE IRAs allowed
  • 529 Plan to Roth IRA rollovers will begin in 2024 (with conditions)
  • Roth employer contributions with after-tax dollars
  • No change to backdoor Roth IRA rules.
  • No clarification of how the 10-year rule will work for non-eligible designated beneficiaries of Inherited IRA accounts.
  • We await clarification on some aspects of these changes.
RMD Age:
  • The new age when you must begin taking RMDs from non-Roth accounts is now – at least temporarily — 73.
  • This applies to those turning 72 during 2023.
  • Those who turned 72 in 2022 – who will turn 73 in 2023 – have only until April 1, 2023 to take this distribution. This is consistent with the existing rule: The first year you reach RMD age, you have until the following April to take it.  Thereafter, you must take each year’s distribution before December 31st.
  • Starting in 2023, the RMD age will again be raised to 75 for those who turn 73 in 2023 or later.

Remember:  You can continue contributing to your IRA even after you begin taking distributions.

Roth Employer Plan RMDs Eliminated:  Any employer sponsored retirement plan with Roth accounts will no longer be subject to RMD requirements for the Roth portion of the account beginning in 2024.  This brings Roth plans in alignment with Roth IRAs.

RMD Penalty Decreased:  The penalty for missing an RMD (or a shortfall) is reduced from 50% to 25%. And if the mistake is timely corrected, the 25% amount is further reduced to 10% starting in 2023. New statute of limitations (previously endless) will be created tied to filing of Form 1040.

Surviving Spouse RMDs:  A surviving spouse can take RMDs from a decedent spouse’s IRA as if he or she was the decedent spouse.

  • This delays RMDs until the decedent would have taken them.
  • The uniform lifetime table instead of single life table is used to calculate (lower) payout requirements.
  • Effective in 2024.

IRA Catch-Up Contributions:  Will be subject to COLA beginning in 2024.

Roth Employer Contributions:  Matching and non-elective safe harbor contributions can be made with after-tax dollars by employers.  Benefits will be taxable.  Effective immediately.

Roth Catch-Up Contributions:  Plan participants with wage income in excess of $145,000 can only use Roth accounts for their catch-up contributions from age 50 onwards.  Effective this tax year for those turning 50.

Special catch-up contributions to employer plans (e.g. 401k) for individuals ages 60-63 of $10K or 150% of the regular catch-up beginning in 2025

529 to Roth IRA Rollover Contributions (beginning 2024):

  • Transfers may only be made to the Roth IRA of a 529 account beneficiary, not the owner.
  • The 529 account must have been maintained for at least 15 years.
  • Any contributions to a 529 plan in the last 5 years are ineligible to be rolled over to a Roth IRA.
  • Annual contribution limits to Roth IRAs still apply.
  • Maximum lifetime rollover benefit is $35,000 per beneficiary.
  • Contribution income limits are disregarded for the rollover.
  • Beneficiaries need earned income to qualify.

Non-Elective Contributions to SIMPLE IRAs:  Employers with SIMPLE plans (subject to some restrictions) will be able to make additional, nonelective contributions to the plans of up to the lesser of 10% of employee compensation, or $5,000 starting in 2024.


Emergency Withdrawals/Distributions:  Now limited to $1,000. Another such withdrawal cannot be made until it’s repaid or three years have elapsed since the last withdrawal.

Penalty-Free Distributions if Terminally Ill:  Death expected within 7 years; up from 2 years.

Domestic Abuse Victims:  Can take lesser of 50% of the balance or $10K from a defined contribution plan beginning in 2024.

Penalty-Free “Qualified LTC” Distributions:  Up to $2,500/year for LTC insurance.

72(t) Withdrawals:  Accounts from which 72(t) withdrawals are being made can be split into separate accounts and still satisfy the SEPP rules.

Qualified Charitable Distribution (QCD) Inflation Indexing:  The $100K limit will be indexed to inflation starting in 2024 and donors can now make a one-time election for a QCD to a split-interest entity (CRUT/CRAT/CGA) of up to $50K (owner/spouse income beneficiaries only).  There is no change to QCD age (70 ½).


Roth SEP/SIMPLE IRAs: Roth accounts will be permitted for these plans beginning in 2023.  Benefits will be taxable.

Emergency Savings Accounts (ESA) created in employer retirement plans:

  • Must be held in cash
  • Max balance of $2500
  • HCEs are ineligible to participate
  • Employers must match contributions to ESA as if salary deferral contributions were made there
  • Tax free distributions

Starter 401(k)/403(b) Plans: Deferrals only, auto-enrollment 3%-15%, contribution limits mirror IRAs and begins in 2024.

ABLE Accounts: May be established for disabilities occurring before age 46 (currently 26) in 2026.

Maximum Qualified Longevity Annuity Contract (QLAC): Limit is $200K and is no longer subject to 25% account balance limitation.

Part-Time Workers: Need only two (2) consecutive years of 500 or more hours to qualify for plan participation starting in 2024.

Student Loan Payments: Can be treated as elective deferrals for matching purposes (subject to vesting schedules).

Solo 401(k) Salary Deferrals: May be made up to tax filing deadline for previous year (instead of calendar year).

Employers and Plan Providers: Will be able to entice employees to participate in plans by offering “de minimis” financial incentives starting in 2023.

Amounts Received via Disability Pension Prior to “Retirement Age”: Continue to be tax-free after retirement for first responders starting in 2027.

Lost, Abandoned and Found Retirement Accounts: The act provides for creation of a database to facilitate matching accounts with rightful owners.