Who would benefit from raising the RMD age under Secure Act 2.0?

Byrne: We all know that Americans are working longer than ever, which means it makes perfect sense that we continue to raise the age requirement for the start date. These provisions make no reference to tax brackets or age, meaning Americans of all backgrounds are free to take advantage of them.

Bloink: It is important to remember that the EARN Act does not pay for these hidden “tax breaks” with tax increases in other areas. It simply allows wealthy taxpayers to opt for Roth IRAs in an effort to circumvent the tax neutrality issue that could prevent the law from becoming law for procedural reasons. In the end, the bill only kicks in the road for future generations to deal with a spiraling deficit.

Byrne: These new proposals simply reflect the fact that every American’s situation can change rapidly over time. Giving Americans the ability to increase their retirement account funding later in life simply gives many people a chance to catch up – and allowing three more years of tax deferral also allows Americans whose success only occurred later in life with a chance to fund a full retirement.

Bloink: The bottom line is that these EARN Act provisions provide a disproportionate benefit to wealthy taxpayers with no corresponding benefit to low-income Americans. Wealthy taxpayers are already the most likely to maximize their retirement contributions and let their funds grow tax-free for the longest time.

We need to focus our efforts on providing benefits that would encourage low- and middle-income Americans to take advantage of these valuable retirement account benefits, rather than focusing on the wealthy.

Byrne: This law would enhance the benefits of a traditional retirement account and give more Americans the ability to save for retirement, regardless of their income level. We cannot assume that only high-income taxpayers will benefit from these new rules. In fact, I expect these new rules to provide a significant benefit to our small business owners who are unable to fully fund retirement accounts for the first few years after opening a business, when income should be diverted to help the business grow.


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