Headlines about "IRAs"
Gathered from the web by the editors at BenefitsLink.com.
Report of Council of Economic Advisers: 'Supporting Retirement for American Families' (PDF)
Feb. 2, 2012. 'While economic studies have established the benefits of annuitization for retirees -- including both immediate and longevity annuities -- many workers have only limited access to these products. The administrative guidance issued by the Treasury today, easing and simplifying certain regulatory requirements for retirement plans and IRAs, takes an important first step towards a more complete private market offering more attractive lifetime income options." (Council of Economic Advisers, Executive Office of the President)
[Official Guidance] Proposed IRS Regs on Longevity Annuity Contracts
"This document contains proposed regulations relating to the purchase of longevity annuity contracts under tax-qualified defined contribution plans under section 401(a) of the Internal Revenue Code (Code), section 403(b) plans, individual retirement annuities and accounts (IRAs) under section 408, and eligible governmental section 457 plans. These regulations will provide the public with guidance necessary to comply with the required minimum distribution rules under section 401(a)(9). The regulations will affect individuals for whom a longevity annuity contract is purchased under these plans and IRAs (and their beneficiaries), sponsors and administrators of these plans, trustees and custodians of these IRAs, and insurance companies that issue longevity annuity contracts under these plans and IRAs." (U.S. Internal Revenue Service)
What Should You Do with 401(k) Funds at Retirement?
"Retirees who want to keep investments sheltered from paying current taxes will essentially have two options. Savings can be left in a company retirement plan, where retirees can keep their money in a lineup of funds chosen by the company. Or the assets can be rolled over into another tax-favored account, generally an individual retirement account, which provides investors with control over investment choices and makes it easier to work with a financial adviser." (The Wall Street Journal)
Boomer Retirements Likely to Boost IRA Share of Retirement Market
"Total IRA assets represent 29.7% of total retirement market assets currently, and as large defined contribution (DC) plan rollovers continue to fuel asset levels, IRAs will encompass 33% of the total retirement market by 2016." (PLANSPONSOR.COM)
[Guidance Overview] IRS Guidance on Reporting 2010 Roth IRA Rollovers and Conversions and 2011 Distributions
"The taxpayer may have to include in 2011 income all or some of the taxable amount of the 2010 rollovers and conversion to a Roth IRA and in-plan Roth rollovers that would have otherwise been included in 2012 income. To determine the amount to report in 2011, the taxpayer must complete the 2011 Form 8606, using Part III, for distributions from a Roth IRA and Part IV, for distributions from a designated Roth account." (Wolters Kluwer Law & Business / CCH)
Federal Retirement Thrift Investment Board to Publish Details About Addition of Roth 401(k) Option to Thrift Savings Plan
"The new Roth TSP component will invest an employee's after-tax earnings and cannot be taxed when withdrawn, similar to a traditional Roth IRA. There will be no income limits on earnings from TSP's Roth option as there are on a traditional Roth IRA, which could make the feature more attractive to federal workers and service members." (Government Executive)
Should You Roll Over Your 401(k)?
"[T]he most common advice that retirees with 401(k) money receive is to roll the plan over into an individual retirement account (IRA). But is this really always the best option? Although the answer to this is clearly yes in many cases, this article will examine the pros and cons of this common financial transaction, and when it may make sense to avoid it." (Investopedia US via Hearst Communications Inc.)
The Backdoor Roth IRA, Advanced Version
"You get a backdoor Roth IRA by opening up a nondeductible IRA and converting it to a Roth. You can contribute $5,000 a year?$6,000 if you're 50 or older. You want a Roth because it grows tax-free -- as opposed to tax-deferred -- and when you take money out -- you don't ever have to -- it comes out tax-free." (Forbes.com LLC)
[Guidance Overview] What to Do About IRA Charitable Donations in 2012
"Sixty federal tax provisions expired in 2011, but one stands out for causing older taxpayers trouble: the individual-retirement-account donation rule. This popular provision [allowed] IRA owners 70? and older to contribute up to $100,000 of IRA assets directly to a tax-free charity. Such donations aren't tax-deductible, but neither do they count as income that might trigger higher taxes on Social Security payments or higher Medicare premiums. Now this benefit is gone, at least until Congress restores it." (Wall Street Journal)
Mitt Romney's Unorthodox IRA
"Like many Americans, Mitt Romney has an individual retirement account. Unlike most Americans, Mr. Romney has between $20.7 million and $101.6 million in it, a big chunk of his fortune." (The Wall Street Journal)
[Guidance Overview] New DOL Regs Offer More Investment Advisers the Opportunity to Provide Advice to Participants in 401(k) Plans and IRAs
"Under the New Regulations, relief is provided for investment advice arrangements qualifying as fee-leveling arrangements, 'certified' computer model programs, or both." (Kilpatrick Townsend & Stockton LLP)
Industry Groups Request DOL Clarify and Refine Fiduciary IRA Data Request
"Industry trade groups told the Department of Labor in a Jan. 12 letter that it would be impossible for them to provide data to DOL concerning conflicts of interests brokers face in advising IRAs by Jan. 15, and requested a meeting with DOL to 'clarify and refine' DOL's original request." (AdvisorOne)
Favorable Tax Environment Adds to Roth 401(k) Appeal
"For most workers, the key factor in determining whether to save for retirement pre-tax or through a Roth 401(k) is their tax rate in retirement. Pre-tax savings are generally more valuable for participants in lower tax brackets in retirement while Roth savings are more beneficial for participants in the same or higher tax brackets in retirement. But with effective tax rates so low right now, Ms. Young points out that it is possible for some workers to be better prepared for retirement using a Roth, even if their tax burden is the same or slightly lower in retirement." (The Vanguard Group, Inc.)
[Guidance Overview] 2011 Reporting for 2010 Roth Rollovers and Conversions
"The [IRS] guidance explains how participants should complete various line items of the 2011 Form 1040 series (which varies based on whether any portion of the amount involved was distributed in 2010 or 2011). Some participants may have a separate reporting obligation on the 2011 Form 8606 for subsequent distributions from the Roth account in 2011." (Mercer Select)
[Official Guidance] 2011 Reporting for 2010 Roth Rollovers and Conversions
"In 2010, you may have: rolled over eligible distributions from a retirement plan to a Roth IRA, converted (transferred) amounts from a non-Roth IRA to a Roth IRA, or made an in-plan Roth rollover (after September 27, 2010). If so, you must report half of the taxable amount of these 2010 rollovers and conversions on your 2011 income tax return unless you . . . ." (U.S. Internal Revenue Service)
On the Roth Feature in 401(k) Plans
"Simply put, the Roth versus pre-tax decision can be thought of as the second step in a retirement planning discussion, says Maria Bruno, a Roth expert at Vanguard. 'It's part of the implementation -- the where and how,' she says. The first step employees must take is deciding whether to participate in their work-sponsored plan. Once that decision is made, the next logical step is to decide whether they want a Roth or traditional plan." (planadviser; free registration required)
How Will Upcoming Changes to Retirement Plans Affect You as a Plan Participant or IRA Owner?
"A tax credit worth up to $1,000 ($2,000 for couples) can be claimed by those who contribute to a retirement plan such as a 401(k) or IRA and have modified adjusted gross incomes of up to $28,750 for singles, $43,125 for heads of household, and $57,500 for married couples." (Forbes)
[Guidance Overview] PTE 80-26 Not Available for Indemnification Agreement with Broker, an 'Extension of Credit' from IRA Owner to IRA
"Advice was sought on whether PTE 80-26 would provide relief from Code Sec. 4975(c)(1)(B) for an indemnification agreement securing a broker from an investment loss and/or tax that an IRA might incur from investing in a futures contract, where the amount of the loss/tax exceeded the amount of assets in the IRA." (Wolters Kluwer Law & Business / CCH)
403(b) Advisor, Spring 2011 Edition
Articles include: Questions and Answers about the New Roth Rollovers in 403(b) Plans and Building Retirement from Floor to Ceiling in the Trend Spotting column. (National Tax Sheltered Accounts Association / American Society of Pension Professional and Actuaries)
[Guidance Overview] IRS's Temporary Relief to IRA Owners, Pending Further Action by the DOL and Further Guidance from the IRS
"While the IRS announcement provides some level of assurance that the agency will not seek to disqualify IRAs based on the DOL positions, financial institutions should nevertheless consider evaluating any indemnification and cross-collateralization provisions in their IRA and non-IRA account agreements in light of the issues raised, to determine whether it is appropriate to make any changes pending further guidance." (Morgan, Lewis & Bockius LLP)
[Official Guidance] IRS Employee Plans News, December 16, 2011 (PDF)
Articles include: Significant changes to the Employee Plans Determination Letter Program - Announcement 2011-82; Relief for IRA owners who have certain agreements with their brokers or financial institutions - Announcement 2011-81; 2011 Cumulative List of Changes in Plan Qualification Requirements - Notice 2011-97. (U.S. Internal Revenue Service)
IRS Reminds Taxpayers to Take Advantage of the Saver's Credit for 2011
"The saver's credit helps offset part of the first $2,000 workers voluntarily contribute to IRAs and to 401(k) plans and similar workplace retirement programs. Also known as the retirement savings contributions credit, the saver's credit is available in addition to any other tax savings that apply." (PLANSPONSOR.COM)
[Guidance Overview] IRS Provides Temporary Relief for IRA Cross-Collateralization Agreements (PDF)
"In Announcement 2011-81 (December 12, 2011), the [IRS] granted temporary relief for an indemnity, security interest or other cross-collateralization agreement provided by an individual retirement account(IRA) owner in circumstances similar to those addressed in [DOL] Advisory Opinion 2009-03A and Advisory Opinion 2011-09A." (Sutherland Asbill & Brennan LLP)
[Official Guidance] Text of IRS Announcement 2011-81: Relief with Respect to IRAs Whose Owners Entered into Certain Agreements with Brokers or Other Financial Institutions (PDF)
"Temporary relief for IRAs owners who have signed certain indemnification agreements or granted certain security interests in their accounts." (U.S. Internal Revenue Service)
[Official Guidance] IRS Announcement 2011-91: IRS to Hold Off on Section 4975 Prohibited Transaction Sanctions for Certain Pledges of IRAs (PDF)
"[U]ntil issuance of further guidance from the IRS superseding this announcement, the IRS will determine the tax consequences relating to an IRA without taking into account the consequences that might otherwise result from a prohibited transaction under ? 4975 resulting from entering into any indemnification agreement or any cross-collateralization agreement similar to the agreements described in DOL Advisory Opinions 2009-03A and 2011-09A, provided there has been no execution or other enforcement pursuant to the agreement against the assets of an IRA account of the individual granting the security interest or entering into the cross-collateralization agreement." (U.S. Internal Revenue Service)
Pitfalls of Inherited IRAs
"If you are the guardian of a child who inherits such an account, you should consider moving the assets into an inherited IRA for the child rather than simply withdrawing the money and paying a sizable chunk of the inheritance in taxes upfront, says William Schmidt, an estate-planning attorney at Schmidt & Federico in Boston." (The Wall Street Journal)
Investors in Self-Directed IRA Accounts Face New Fraud Threats
"Self-directed IRAs are attractive because of their wide latitude. While many banks and brokerage firms limit IRA investors to stocks, bonds, mutual funds and certificates of deposit, the only assets off-limits in individual retirement accounts, per the U.S. tax code, are life-insurance policies and collectibles, including some types of coins." (The Wall Street Journal)
Tax Benefits and Allocation Issues in Rollovers to Roth IRAs
"The goal of this analysis is to provide practitioners with an overview of the potential retirement and estate planning benefits of rollovers from a 401(k) plan into a Roth IRA, as well as to alert practitioners to the impact that common 401(k) plan distribution rules will have on the tax benefits of such a rollover in light of the current IRS allocation rules." (Texas Tax Lawyer via Haynes and Boone, LLP)
[Official Guidance] Text of EBSA Advisory Opinion 2011-09A Concerning Applicability of Prohibited Transaction Exemption 80-26 to Certain Transactions Involving IRAs
"[The EBSA responds on w]hether PTE 80-26 provides relief for an indemnification agreement between an IRA owner and a broker where such agreement is required in order for the IRA to engage in futures trading." (U.S. Employee Benefits Security Administration)
Harnessing the Anything-Goes IRA
"According to the SEC, self-directed IRAs hold about $94 billion, or 2% of the assets in all IRAs. Neither regulators nor the Retirement Industry Trust Association, which represents administrators of self-directed IRAs, could say whether the amount in these accounts has grown in recent years." (The Wall Street Journal)
Additional Data on IRA Ownership in 2011: Appendix to 'The Role of IRAs in U.S. Households' Saving for Retirement, 2011' (PDF)
"This appendix provides supplementary tables with additional detail for the main report." (Investment Company Institute)
The Role of IRAs in U.S. Households' Saving for Retirement, 2011 (PDF)
"About one-third of U.S. households owned traditional IRAs in 2011. Traditional IRAs were the most common type of IRA owned, followed by Roth IRAs and employer-sponsored IRAs." (Investment Company Institute)
Thrift Savings Plan Gears Up to launch Roth Option
"Staff worked this summer and fall to install software for record-keeping of the tax options selected by participants. The next stage will allow participants to transfer funds in from other employers, and the third stage will allow them to transfer money out when they leave the plan." (Government Executive)
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