Deciphering the Secure Act 2.0
What comes to mind when I say “the agony of Christmas toys”? Two things jump out at me. First is stepping on a Lego piece first thing in the morning. Ok, when country singer Trace Adkins wrote, “You’re gonna miss this.” He was right. I miss the kids being little, but not the shooting pain in my foot.
So what’s the second thing that comes to mind when I say the agony of Christmas toys? That is the many complicated toys I used to help Santa put together on Christmas Eve. That same uncomfortable feeling I got from the agony of Christmas toys is like what I feel now when I look at the budget bill passed by Congress last month.
Your tax dollars at work
In short, you probably know about the bill because the news media focused on the $1.7 trillion cost. There is so much in that bill that it doesn’t have a name. All they could call it was the “omnibus bill.” It should be the ominous bill. In short, there is more money to provide the security of foreign governments than there is for the United States border. Not to mention the $3.6 million for the “Michelle Obama Trail” in Georgia and $65 million to save Pacific salmon. As far out as those things sound, that is not the focus of my writing today.
The Secure Act 2.0 probably affects you.
In any case, my brain is getting a workout on the new retirement provisions. That part does have a name. It’s called the Securing a Strong Retirement Act of 2022 or Secure Act 2.0. FYI, the Secure Act 1.0 was enacted in 2019. So, you may be asking yourself, what’s the connection to the agony of Christmas toys?
For years, I had the joy of helping Santa put together Christmas toys for my little boys. Santa would drop off the gifts, and he was in such a hurry that he gave me a few Christmas cookies in exchange for my help. After he left, I would be up into the wee hours of the night putting together toys. Hot Wheels was my nemesis. After putting all those little parts together, I’d struggle to get the stickers in just the right spot.
And then there was the curse of extra parts. My son always used to say the additional pieces were always leftover, just in case you needed a few spare parts. Well, both you and I know that was only half right.
Visions of tax laws dance in my head
I feel that same toy assembly frustration when looking at the new retirement plan law or the Secure Act 2.0. There are over 100 new provisions that apply to a company and individual retirement plans. An army of lawyers put the Secure Act 2.0 together. Now I get to decipher which parts to talk to clients about single-handedly.
It is the agony of Christmas toys all over again. Regretfully, I don’t get to see the joy in my children’s eyes on Christmas morning while dealing with the Secure Act 2.0. Instead, I get to see the deer-in-the-headlights look that clients give me when I try to explain how the new law applies to them.
Not to worry, I will not bore you with all 100 provisions of that law today. To sum up the provisions I think may affect you, I wrote a summary of the Secure Act 2.0’s top provisions. The download is below. This law will more than likely affect you in some way.
Cookies fix everything, almost.
I am sorry to bring the agony of Christmas toys to you. However, if you own any type of retirement account, it would be in your best interest to look at the top provisions in the Secure Act 2.0 and see what may apply to you. And if it hurts your head, maybe some Christmas cookies are left at your house to brighten your day. No need to look for cookies at my house. There is one gingerbread cookie with my name on it.
To end today, remember that this information is for educational purposes only. This information is not investment, accounting, or tax advice. For those things, you need to find yourself a good fiduciary advisor. 😉
Have a great week,
Van
PS, here are some other great topics from my blog that may interest you.
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