Business
On this episode, Charles Musgrove and guest Taylor Hodges from Southern Capital discuss a variety of topics including:The 529 College Savings Plan and how the 2019 SECURE Act has expanded the use of the plan assetsThe Safe Harbor provisionNon-ERISA plans or the Golden Handcuff and practical examplesDistributions from inherited retirement plansBalance of tax deferred vs after tax savings2019 SECURE Act:Small business owners will receive a tax credit for establishing a retirement planAdditional tax credit for adopting auto enrollmentNew provisions to allow part-time employees with less than $1,000-hours to join 401KElimination of stretch provisions for beneficiariesWith a few exceptions, most non-spouse beneficiaries will have 10 years to withdrawal 100% from the inherited IRA – No RMDs during 10-year windowWill count as income to beneficiary – Shift assets to tax-free?RMD age pushed back to age 72Only for people who turn 70 ½ after January 1, 2020Everyone should check to make sure their beneficiaries are updatedIf beneficiary is a Trust, understand how it may effect beneficiary amounts and taxes on distributions Executive BenefitsGoal for business owners is to attract, retain and reward good employeesERISA – 401K, SEP, ESOPNon-ERISA – NQDC, Phantom Stock, Golden HandcuffDifferent for 8(a) companies due to program restrictions on income and net worthSpecialize in 8(a) – Unique planning process ArticlesThe Hierarchy Of Tax-Preferenced Savings Vehicles For High-Income Earners:https://www.kitces.com/blog/hierarchy-tax-preference-savings-vehicle-roth-high-income/Tax Brackets Resource:https://www.nerdwallet.com/blog/taxes/federal-income-tax-brackets/2019 SECURE Act:https://www.kitces.com/blog/secure-act-2019-stretch-ira-rmd-effective-date-mep-auto-enrollment/Don't Die Yet: New U.S. Law Will Muddle Estate Plans:https://www.kitces.com/blog/tax-rate-equilibrium-for-retirement-taxable-income-liquidations-rothconversions/